La. Admin. Code tit. 61 § I-6105

Current through Register Vol. 50, No. 8, August 20, 2024

Section I-6105 - Definitions

A. Terms not otherwise defined in this Chapter shall have the same meaning given to them in R.S. 47:6007, unless the context clearly requires otherwise.

B. In this Chapter, the following terms shall have the meanings provided herein, unless the context clearly indicates otherwise.

Allocatee-an individual or entity that received an allocation of investment tax credits.

Allocator-an individual or entity that makes an allocation of investment tax credits.

Base Investment-cash or cash equivalent investment made and used for production expenditures in the state for a state-certified production.

Begin Construction-Repealed.

a. in the case of a new building, either:

i. materials to be used in the project, worth more than 5 percent of the construction budget, are placed at the project site; or

ii. other work is performed on the site which is visible from a simple inspection and reasonably indicates that the work has begun, such as substantial land fill, soil reinforcement or pouring of a foundation. The following are examples of services which do not indicate that work has begun; services of surveyors or engineers; cutting or removal of trees; demolition of existing structures or clearing of the land surface;

b. in the case of a retrofit project to an existing structure:

i. materials to be used in the project, worth more than 10 percent of the construction budget, are placed at the project site; or

ii. equipment to be used in the project, worth more than 20 percent of the construction budget, is placed and operational at the project site.

Commencement of Production-Repealed.

Commissioner-Repealed.

Completion Notification-the date all required steps for certification of credits are complete, as confirmed in writing by the department.

Cost Report of Production Expenditures-a report of production expenditures formatted in accordance with LED accounting guidelines, which may be issued with initial certification, posted on LEDs website or otherwise communicated by LED to applicant in writing.

Cost Report Submission Deadline-the date detailed in the initial certification letter by which a cost report shall be submitted to LED, after which time all such claims to tax credits shall be deemed waived.

Department-Louisiana Department of Economic Development, or its successor.

Developer-Repealed.

Director-Director of the Office of Entertainment Industry Development (the office).

Division-Repealed.

Expended in the State-

a. an expenditure to lease immovable property located in the state;

b. an expenditure as compensation for services performed in the state; or

c. an expenditure to purchase or lease tangible personal property within the state where the transaction is subject to the state sales or lease tax provisions of Title 47 of the Louisiana Revised Statutes of 1950:

i. a transaction that is subject to the states sales or lease tax provision of Title 47 of the Louisiana Revised Statutes of 1950 shall include transactions that are also subject to statutory exclusion or exemption.

Expenditure-actual payment of cash or cash equivalent, paid by or on behalf of a state certified production exchanged for goods or services, as evidenced by an invoice, receipt or other such document.

Indirect Costs-costs of operation that are not directly associated with a state certified production, such as clerical salaries, general administrative costs and other overhead charges.

Investor- any individual or entity that makes an investment in a state-certified production including but not limited to any individual or entity that is identified as a source of funds for a state certified production on its expenditure verification report, individual or entity identified as an irrevocable designee for receipt of tax credits.

LDR-Louisiana Department of Revenue

Legacy Tax Credit Reservation-is a provisional allocation of tax credits in a given fiscal year, as evidenced by an initial certification letter issued prior to July 1, 2023, that has not expired or been released in accordance with the provisions of §6107

Louisiana Publisher-Repealed.

Louisiana Resident-a natural person who is required to file a Louisiana resident individual income tax return.

Louisiana Screenplay-a screenplay created by a Louisiana resident, as evidenced by documents such as certificate of authorship, a WGA registration certificate, the records of the United States Copyright Office, or other documentation approved by the office.

Non-Applicable Production Expenditures-the following expenses are not eligible to earn tax credits:

a. expenditures for marketing and distribution;

b. non-production related overhead;

c. amounts reimbursed by the state or any other governmental entity;

d. costs related to the transfer of tax credits;

e. amounts that are paid to persons or entities as a result of their participation in profits from the exploitation of the production;

f. the application fee;

g. state or local taxes;

h. any other expenditure not allowed by law or regulation.

i. expenditure verification report deposit and fees;

j. For applications received on or after July 1, 2016, bond fees, insurance premiums, finance fees and loan interest fees shall not qualify for tax credits, except for fees paid to certain Louisiana companies, in which case the expenditures to be allocated only on a pro rata basis, allocating the fees based on the relative percentage of production activity occurring in Louisiana;

k. For applications received on or after July 1, 2017, catering and craft services shall not qualify for tax credits unless such expenditures are made to a source within the state.

Office-Office of Entertainment Industry Development.

Production Expenditures-preproduction, production and postproduction expenditures directly incurred in this state that are directly used in a state-certified production, whether the production company directly contracts or subcontracts such work, including without limitation the following:

Payroll-all salary, wages and other compensation, including benefits paid to an employee and taxable in this state. However, payroll for purposes of the additional tax credit for Louisiana-resident payroll shall exclude any portion of an individual salary in excess of one-million dollars.

Person-there are two kinds of persons; natural and juridical.

a. A natural person is a human being.

b. A juridical person is an entity to which the law attributes personality, such as a corporation, partnership or limited liability company

Procurement Company-any person or entity that purchases, leases or otherwise obtains goods or services from sources outside of the state, for the ultimate use, benefit or enjoyment of a state-certified production company.

Production Expenditures- preproduction, production and postproduction expenditures directly incurred in this state that are directly used in a state-certified production, whether the production company directly contracts or subcontracts such work, including without limitation the following:

a. set construction and operation;

b. wardrobes, make-up, accessories, and related services;

c. costs associated with photography and sound synchronization, lighting, and related services and materials;

d. editing and related services;

e. rental of facilities and equipment;

f. leasing of vehicles;

g. costs of food and lodging;

h. digital or tape editing, film processing, transfer of film to tape or digital format, sound mixing, special and visual effects (if services are performed in Louisiana);

i. total aggregate payroll (limited to the amount of total payroll expended in Louisiana and which is taxable to the recipient in Louisiana. A Louisiana tax return is required to be filed reflecting the amount of compensation paid while the recipient is located in Louisiana. If the recipient is not a Louisiana resident, then a non-resident income tax return should be filed);

j. music, if performed, composed or recorded by a Louisiana resident, or released or published by a Louisiana-domiciled and headquartered company;

k. payments to a loan-out or personal services corporation for the services of an out-of-state hire are allowed as long as the services are performed in Louisiana on a state certified production and all withholding requirements are met.

l. - m Repealed.

Production Facility-Repealed.

Program Issuance Cap- for applications submitted on or after July 1, 2017 and prior to July 1, 2023, the office may issue no more than $150,000,000 in tax credits ("total cap") in any fiscal year, with $7,500,000 reserved for qualified entertainment companies ("QEC cap"), $7,500,000 reserved for Louisiana screenplay productions ("LA screenplay cap"), $15,000,000 reserved for independent film productions ("independent film cap"), with the remaining $120,000,000 available for general allocation to any state certified production ("general cap"); for applications received on or after July 1, 2023, the office may issue no more than $150,000,000 in tax credits in any fiscal year.

m. payments to a loan-out or personal services corporation for the services of an out-of-state hire are allowed as long as the services are performed in Louisiana on a state certified production and all withholding requirements are met.

n. cost of the independent audit.

La. Admin. Code tit. 61, § I-6105

Promulgated by the Department of Economic Development, Office of Business Development, Office of Entertainment Industry Development and the Office of the Governor, Division of Administration, LR 36:53 (January 2010), amended by the Department of Economic Development, Office of Business Development, Office of Entertainment Industry Development, LR 43:300 (February 2017), LR 43:2102 (November 2017), repromulgated by the Department of Economic Development, Office of Business Development, LR 45869 (7/1/2019), Amended by the Department of Economic Development, Office of Entertainment Industry Development, LR 46179 (2/1/2020), Amended LR 481495 (6/1/2022), Amended LR 481915 (7/1/2022), Amended LR 492089 (12/1/2023).

AUTHORITY NOTE: Promulgated in accordance with R.S. 47:6007.