This bill amends New Jersey's Film and Digital Media Tax Credit Program by introducing a requirement that all original music and musical scores for film and digital media productions must be produced and recorded domestically within the United States or its territories. This stipulation is now a condition for taxpayers seeking tax credits for qualified film production expenses, which remain at 40% for New Jersey studio partners and 35% for other taxpayers, while digital media content production expenses will receive a 30% credit. The bill also maintains existing eligibility requirements, such as incurring a significant portion of production expenses in New Jersey and submitting a tax credit verification report, while clarifying that no tax credits will be allowed for costs already included in other tax credits or exemptions.

Additionally, the bill establishes definitions and criteria for designating "New Jersey studio partners" and "New Jersey film-lease partner facilities," outlining the requirements for film production companies to qualify for tax credits. It introduces a mechanism for taxpayers to transfer tax credits and sets cumulative limits on the total value of tax credits that can be approved for various categories, with specific caps leading up to 2040. The bill also mandates the submission of reports by independent certified public accountants to verify tax credit claims and includes provisions for withholding taxes from payments made to loan-out companies and independent contractors. Overall, the bill aims to enhance the film production industry in New Jersey by streamlining tax credit processes and ensuring compliance with state tax laws.

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