Connecticut

Applicant must register with the Connecticut Secretary of State and Department of Revenue; submit an eligibility application along with a $200 fee no later than 90 days after the first qualified production expense is incurred; meet the minimum in-state spending requirement of at least $100,000; conduct at least 50% of principal photography days within the state or spend at least 50% of the film’s postproduction costs or at least $1 million in postproduction in Connecticut; and submit a tax credit voucher application, along with a fee equal to 1% of the anticipated credit but not more than $5,000, no later than 90 days after the last qualified expenditure is incurred in the state. Loan out companies must be registered with the Department of Revenue. Tax credit vouchers for a theatrical motion picture production will not be issued unless 25% or more of principal photography days occur within a Connecticut facility that received at least $25 million in private investment and opened for business on or after July 1, 2013. Currently, theatrical motion picture productions do not qualify.

Compensation to “star talent” (paid to individuals or loan outs) is capped at $20 million in the aggregate and must be subject to Connecticut personal income tax. Qualified spend includes costs incurred in the duplication of films, videos, CDs, and DVDs. Costs incurred for goods outside the state and used within Connecticut as well as costs related to the required audit do not qualify. In order to qualify payments made to a loan out company, the production company must provide confirmation the loan out company filed Form REG-1 (Business Tax Registration Application). Generally, this is accomplished by the loan out company providing the production company with the letter from the Department of Revenue notifying the loan out company that the application was successfully processed.

This program is administered on a first-come, first-served basis. The transferable tax credit ranges from 10% to 30% depending on the total amount of in-state production expenditures. A production company may not transfer more than 25% of the credit in any year unless: (1) the production is created in whole or in part at a qualified production facility within the state, (2) the production company is organized as a “C” corporation and is subject to tax in Connecticut, or (3) the production company owns at least 50% of a CT LLC subject to the Business Entity Tax. Tax credits are claimed in the income year in which spending began. The state may seek recovery from any entity that committed fraud or misrepresentation in claiming the credit. For income years commencing on or after January 1, 2024, but prior to January 1, 2026, the limit on the value of the tax credits that may be claimed against sales & use tax increased from 78% to 92%. See the statute regarding limits on the value of the tax credits that may be claimed against sales & use tax, insurance premiums tax, and transmission tax.