The bill amends New Jersey's Film and Digital Media Tax Credit Program to enhance financial incentives for film and digital media production. It introduces a tiered tax credit system, offering a 40% credit for qualified film production expenses to New Jersey studio partners and film-lease production companies, and a 35% credit for other taxpayers, contingent upon meeting specific criteria such as incurring a minimum percentage of expenses in New Jersey and commencing principal photography within a designated timeframe. Additionally, the bill establishes a 30% tax credit for qualified digital media content production expenses, with potential increases for post-production services, and allows for the transfer of tax credits between taxpayers.

Key changes include new definitions for "New Jersey film-lease production company" and "New Jersey studio partner," as well as expanded eligibility for qualified expenses, which now encompass wages for individuals exempt from New Jersey income tax due to reciprocity agreements. The bill also sets cumulative limits on the total amount of tax credits available for various categories of taxpayers, ensuring sustainability while promoting industry growth. Furthermore, it mandates withholding taxes from payments to loan-out companies and independent contractors at a rate of 6.37%, and requires taxpayers to submit independent verification of their tax credit claims post-production. Overall, the revisions aim to make New Jersey a more attractive destination for film and digital media production.

Statutes affected:
Introduced: 54:10A-5.39, 54A:4-12