As with several other states, the 2020 economic slump encouraged a revamping of tax benefits to bring more work into the state of Arkansas. In May 2021, Arkansas edited its outdated film tax incentive to be a much better scenario for filmmakers. Prior to the year 2021, Arkansas’ beautiful landscape saw rare film opportunities simply because there was no financial benefit other than the low cost of living (approximately 14% lower than the rest of the nation). Any producer or director who fell in love with the beauty couldn’t find an experienced local crew. Many Arkansas filmmakers hope to see that change over the next several years as the competitive tax incentives should draw a crowd.
What are the benefits?
An eligible production company may earn a 20% rebate on all qualified production expenditures in Arkansas. Salaries and wages paid to resident and nonresident above-the-line employees, as well as resident and nonresident below-the-line employees, will qualify for the 20% rebate and an additional 10% may be earned on the payroll of below-the-line employees who are full-time Arkansas residents for a total rebate of 30% on such wages. Below-the-line does not include directors and producers, but for the additional 10%, resident actors and writers are defined as below-the-line. The incentive program is scheduled to sunset on June 30, 2029.
What are the requirements?
Prior to beginning preproduction activities in Arkansas, productions must: Register with the film office Submit an application along with an estimate of expenditures Meet the minimum spending requirement of at least $50,000 within a six-month period in connection with a postproduction project or $200,000 within a six-month period in connection with the production of one project Apply for a production rebate certificate no later than 180 days after the last production expenses are incurred. Each project is evaluated on a case-by-case basis.
What are qualified expenditures?
Qualified expenses include: Costs incurred in Arkansas in the development, preproduction, production, or postproduction of an eligible production; The first $500,000 of wages or salaries paid to each resident and nonresident that are subject to Arkansas income taxes; pension, health, and welfare contributions Stipends and living allowances. Payments for production and post-production expenses are recommended (but not required) to be made from the checking account of an Arkansas institution. (Cash payments to vendors may not exceed 40% of the total verifiable costs.)
How can I apply for the Arkansas Film Tax Incentive?
For more information on the Arkansas film tax incentive, contact:
Christopher Crane, Arkansas Film Commissioner.
Phone: (501) 682-7676
Address: Arkansas Film Commission 900 West Capitol Ave, Suite 400 Little Rock, AR 72201
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