La. Admin. Code tit. 61 § I-6535

Current through Register Vol. 50, No. 9, September 20, 2024

Section I-6535 - Rules of Application

A. The sound recording investor tax credit authorized by R.S. 47:6023(C) may be earned and claimed as follows.

1. There is authorized a credit against the state income tax for investments made in state-certified productions, which credit will be earned by investors at the time expenditures are certified by the Louisiana Department of Economic Development according to the total base investment certified for the sound recording production company per calendar year. No credit shall be allowed for any expenditures for which a credit was granted under R.S. 47:6007.

2. Applicants meeting the following criteria shall be eligible to receive tax credits as follows:

a. for state-certified productions initially certified prior to July 1, 2015:

i. 25 percent tax credit, if the total base investment is more than $15,000, or if a resident of this state, if the total base investment is more than $5,000;

b. for state-certified productions initially certified on and after July 1, 2015:

i. 18 percent tax credit, if the total base investment is more than $15,000, or if a resident of this state, if the total base investment is more than $5,000.

c. for applications by qualified music companies ("QMC's") for state certified productions, received on or after June 18,2019:

i. to the extent that the base investment by a QMC is expended on a sound recording production of a resident copyright, the investor shall be allowed an additional ten percent increase in the base investment rate.

3. An application for initial certification of a project shall be submitted to the Louisiana Department of Economic Development prior to the granting of the credit, and the granting of the credits under this Rule shall be on a first-come, first-served basis based on when the proper cost reports as defined here under RS 47:6023, are submitted to DED for certification of tax credits, which shall be determined by the date of a signed receipt via certified or registered mail, courier, hand or other delivery, or the date on a proof of transmission via facsimile and/or by the DED stamped and staff initialed date. The Secretary of the Department of Economic development shall determine annually the annual aggregate maximum. If the total amount of credits earned for any particular year exceeds the aggregate amount of tax credits allowed for that year, the excess will be treated as having been earned on the first day of the subsequent year.

a. Applications for a series of productions shall provide the titles, budgets and a brief description for each production in the series. The series of productions, as a combined group, must at least achieve, and may exceed the minimum investment. If one single project may, on its own, exceed the $15,000 minimum threshold, it must make separate application.

4. Individuals or entities may earn sound recording investor tax credits pursuant to R.S. 47:6023(C).

5. Any individual or entity shall be allowed to claim the sound recording investor tax credit authorized by R.S. 47:6023:

a. whether or not any such individual is a Louisiana resident; and

b. whether or not any such entity is domiciled in Louisiana, organized under Louisiana law, or headquartered in Louisiana.

6. Any applicant applying for the credit shall be required to reimburse the department for any audits required in relation to granting the credit.

7. Application Fee. Applicants with project expenditures greater than $15,000 shall submit a $250 fee with each application. LED shall waive the application fee for applicants with project expenditures up to $15,000.

8. Expenditure Verification Report Fee. The department shall directly engage and assign a CPA to prepare an expenditure verification report on an applicant's cost report of production or project expenditures. Applicants shall submit an advance deposit at the time of application, and shall later be assessed the department's actual cost based upon an hourly rate as provided in R.S. 36.104.1, in the amounts set forth below:

a. for applicants with project expenditures of at least $10,000 but less than $25,000, an advance deposit of $750, with a maximum fee of $1,500;

b. for applicants with project expenditures of at least $25,000, an advance deposit of $1,500, with a maximum fee of $3,000;

c. for applicants with project expenditures of at least $50,000, but less than $100,000, an advance deposit of $2,500, with a maximum fee of $5,000;

d. for applicants with project expenditures of more than $100,000, an advance deposit of $3,750, with a maximum fee of $7,500;

e. any unused balance shall be refunded to the applicant within 60 days following receipt of CPA's final invoice and payment of all CPA costs.

La. Admin. Code tit. 61, § I-6535

Promulgated by the Department of Economic Development, Office of Business Development and the Department of Revenue, LR 34:1348 (July 2008), amended by the Department of Economic Development, Office of Business Development, Office of Entertainment Industry Development, LR 36:305 (February 2010), LR 42:38 (January 2016), repromulgated by the Department of Economic Development, Office of Business Development, LR 45882 (7/1/2019), Amended by the Department of Economic Development, Office of Entertainment Industry Development, LR 461081 (8/1/2020).

AUTHORITY NOTE: Promulgated in accordance with R.S. 47:6023 and R.S. 36:104.