Montana offers a media credit for certain costs of qualifying film, television, and other media productions
Pre-Certification with the Department of Commerce
First, production companies must be registered with the office of the Montana Secretary of State. Productions should register at least 7 to 10 days before applying.
Before production begins, productions must apply for pre-certification with the Montana Department of Commerce Film Office.
Media Credit Application with the Department of Revenue
To claim the MEDIA credit, productions must apply with the Department of Revenue. The “submission of costs” must be submitted within 60 days of principal photography for the credit to be available in the year of production; otherwise, the credit will be pushed back one year. In addition, as part of the application, a CPA report is due by April 15 of the year following the year of production.
Media Credit Cap
The total amount of tax credits claimed by all productions cannot exceed $10 million in any calendar year:
|Total Credit Reserved||$0||$0||$0||$0||$0||$0|
|Total Credit Validated||$0||$0||$0||$0||$0||$0|
|Total Credit Available||$10,000,000||$10,000,000||$10,000,000||$10,000,000||$10,000,000||$10,000,000|
If the full amount of credit is not utilized, then the remaining credit is not carried forward. For example, if only $5 million of the credit is used in a tax year, the remaining $5 million does not get carried forward to the following tax year.
However, excess validated credit is pushed to the following year. For example, if a production earns $15 million dollars of credit in Year One and the cap has already been reached, the excess credit can be taken in Year Two.
For purposes of determining priority, priority is based on when the production company submits a complete application, which includes the “submission of costs, CPA report, and application fee.”
The Montana Department of Commerce Montana Film Office has more information, instructions on registering with the Montana Secretary of State and applying for pre-certification. To calculate the credit based on potential expenditures and labor costs visit the Montana Film Office Credit Estimate Calculator. This is only an estimate for your purposes.
The credit includes a 20 percent income tax credit on pre-production, production, and post-production expenditures in the state. Additional incentives can increase the credit up to 35 percent of the production’s base investment in the tax year.
These per production, additional incentives include:
- 25% of compensation for Montana resident crew
- 15% of compensation for non-Montana resident crew
- 20% of above-the-line compensation (actor, director, producer, writer)
- 30% of compensation paid to a student enrolled in a MT college/university who works on the production for college credit
- 10% of payments to MT colleges/universities for stage, equipment, rentals, or location fees for filming on campus
- 10% of all in-studio facility/equipment expenditures that rents a studio for 20 days or more
- 5% of expenditures in an underserved county
- 5% for using “Film MONTANA” screen credit
- 25% of post-production wages (Effective Jan. 1, 2021)
Frequently Asked Questions
- Department of Commerce
- You must submit an initial media credit application with the Montana Department of Commerce prior to the commencement of principal photography in Montana. Learn more about the Montana Department of Commerce’s application process.
- Department of Revenue
- You must also submit a media credit application with the Montana Department of Revenue after you have completed principal photography.
A complete media credit application consists of the following three items:
- Submission of Costs
- CPA Report
- Media Credit Fee
The Submission of Costs includes information used to substantiate the credit and may include the following:
- Media credit spreadsheet provided by the Department of Revenue
- General ledgers
- Invoices/purchase orders
- Earnings and payroll reports
- Check stubs
- Form MEDIA-COMP for each employee and loan-out
- Loan-out withholding agreements
- Verification of loan-out withholding payments
- Other supporting documentation
- The Submission of Costs should be organized by expenditures and compensation. Expenditures must be coded under the appropriate category and separated into corresponding folders for each category. If purchases were made in an underserved area, then that information should be noted as well. For example, an invoice for craft services should be labeled as Category A and, if appropriate, the applicable underserved county.
- All compensation should be included in one folder and separated by each individual’s weekly compensation. Compensation should be substantiated by earnings reports, check stubs, and other information needed to verify qualification for the credit. For example, the report must include if the individual was compensated for kit rentals, mileage, time-and-a-half, etc. It must also indicate whether the compensation is sourced to Montana or another state.
- Media Credit Fee
- Please provide a copy of the check with your Submission of Costs. Submit your fee using the payment voucher.
If you are claiming credit for a particular individual, then Form MEDIA-COMP must be filled out in its entirety, otherwise credit will be denied for that individual.
Provide all of the MEDIA-COMPs in one folder when submitting your application.
Currently, the Department of Revenue does not provide “agreed upon procedures” between the CPA and the Department of Revenue.
However, 15-31-1006, MCA does provide that the report must:
- Be issued by a CPA who is unrelated to the production company;
- Be performed in accordance with accounting standards generally accepted in the United States;
- Be addressed to the person who engaged the accountant, with a copy addressed to the production company, post-production company, or person who applied for the credit;
- Include the accountant’s name, address, and telephone number;
- Include the date of completion of the accountant’s work; and
- Contain a statement of acknowledgment by the accountant that the state is relying on the report to issue tax credits.
For additional information, see ARM 42.4.3413
Once you have completed principal photography, you will need to submit your Submission of Costs to the Department of Revenue within 60 days of principal photography (which includes wrap) if you would like to claim the credit in the year of production. The CPA Report must be submitted by April 15 of the year following the year after completion of principal photography. Time computation for deadlines falling on weekends or holidays shall conform to 1-1-307, MCA, which provides any acts required to be done may be performed upon the next business day with the same effect as if it had been performed upon the day appointed.
The CPA Report must be submitted by the April 15 due date to be eligible for the credit.
The Department of Revenue will notify you by either email or letter that it has received your application and will follow-up with any additional questions.
After the Department of Revenue completes its audit of your application, you will receive a confirmation letter with the approved credit amount and a Unique Identification Registration Number (UCRN), which you will need to take the credit on your Montana tax return or to transfer the credit.