HB655: HB655 Income tax; postproduction expenditures; renew a tax credit

Georgia previously offered a tax credit to postproduction companies (businesses that do film editing, sound mixing, visual effects and similar work after filming) for money they spent in the state, but that credit stopped applying to taxable years beginning on or after January 1, 2023. House Bill 655 would bring the credit back for taxable years from 2026 through 2030, and raise the yearly statewide cap on these credits from $10 million to $60 million. The bill also creates a new 5 percent bonus credit for postproduction companies that spend $250,000 or more in counties with fewer than 100,000 residents where at least 10 percent of the population lives in poverty, based on U.S. Census data. It expands the list of qualifying projects to include 'special venue projects' and clarifies that footage shot outside Georgia can still count if the production is otherwise based in the state. Companies claiming the credit must keep reporting employment figures to the legislature each year by June 30. The changes would take effect July 1, 2025, and apply to taxable years starting on or after January 1, 2026.

• Renews the postproduction expenditure income tax credit under O.C.G.A. § 48-7-40.26A for taxable years beginning January 1, 2026 through December 31, 2030, after it had lapsed for years starting in 2023.
• Raises the statewide annual cap on total postproduction tax credits from $10 million to $60 million per year.
• Creates a new 5 percent bonus credit for postproduction companies that spend $250,000 or more in smaller counties (population under 100,000) where at least 10 percent of residents live in poverty.
• Directs the commissioner of community affairs to publish a list of qualifying rural, high-poverty counties by December 31 each year.
• Expands the definition of a qualifying production to include 'special venue projects' and clarifies that footage shot outside Georgia can still qualify for the credit.
• Continues a requirement that postproduction companies claiming the credit report full-time employee counts to the Department of Revenue, which must summarize this for state legislative committees by June 30 each year.

Postproduction companies working on film, TV, music video, and interactive entertainment projects in Georgia; the state Department of Revenue and Department of Community Affairs, which administer and report on the credit; and residents of smaller, higher poverty Georgia counties that could see increased postproduction spending.

Postproduction companies would again be able to claim state income tax credits for editing, sound, and visual effects work done in Georgia starting in 2026, with a much larger pool of credits available than before. Companies that direct spending to certain rural, high poverty counties could earn an extra credit, potentially shifting where postproduction work happens in the state.

• Section 1 amends O.C.G.A. § 48-7-40.26A's definition of 'qualified postproduction expenditures' to clarify it covers footage shot inside or outside Georgia connected to an in-state production.
• Section 1 expands 'qualified production' to explicitly include special venue projects alongside feature films, series, pilots, and music videos.
• Section 1 adds a new subsection (c.2) creating a 5 percent bonus credit for spending $250,000 or more in smaller counties with high poverty rates, as identified annually by the commissioner of community affairs.
• Section 1 revises subsection (d) to reset the aggregate annual cap at $60 million for taxable years 2026 through 2030, replacing the prior $10 million cap that applied through 2022.
• Section 1 keeps a carryover rule letting unclaimed portions of a year's aggregate cap roll into future years until fully claimed.
• Section 1 extends the requirement that postproduction companies report monthly average full-time employee counts to the Department of Revenue, which must relay a summary to the House Ways and Means and Senate Finance Committees by June 30 annually.
• Section 2 sets the effective date as July 1, 2025, applying to taxable years beginning on or after January 1, 2026.
• Section 3 repeals conflicting laws.

1. 2025-02-28House Second Readers (House)
2. 2025-02-27House First Readers (House)
3. 2025-02-26House Hopper (House)

• Scott Hilton (R, HD-048)Primary sponsor
• James Burchett (R, HD-176)
• David Clark (R, HD-100)
• Kasey Carpenter (R, HD-004)
• Steven Sainz (R, HD-180)
• Spencer Frye (D, HD-122)

• film tax credits
• income tax
• postproduction industry
• rural economic development
• Georgia film industry