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Digital Business Incentives

Film Production Tax Credit
Film Production Gross Receipts Tax Deduction
Film Investment Program
Web Hosting Gross Receipts Tax Deduction

 

For more information or a free custom analysis of tax incentives for your company, call 800-226-2935 or email us .

Film Production Incentives

With a long history of movie-making, New Mexico offers stunning locations, great filming weather, production stages, post-production facilities, and a skilled labor pool of technicians and actors. In 2002 New Mexico created three incentives to encourage film production.

The filmmaking industry consists of local firms who make commercials, as well as film production companies that come to New Mexico to make movies or television shows.

All three incentives require companies to register with the Film Division of the NM Economic Development Department. For details and directions on how to apply, see the New Mexico State Factbook, New Mexico Film Office, email film@nmfilm.com or call (800) 545-9871.

Film Production Income Tax Credit

  • The credit is based upon costs of producing films, videogames and national or regional advertising content, in film and digital formats,
  • For taxable years beginning before January 1, 2006, a personal or corporate income tax credit up to 15% of the total direct production costs incurred in New Mexico after January 1, 2002.
  • For tax years beginning January 1, 2006 through December 31, 2009, up to 25%.
  • For tax years beginning January 1, 2009, up to 20%
  • Credit applies to all industry accounting standard direct costs taxable by New Mexico.
  • Companies must register before production; credit applies after production in New Mexico has been completed for a tax year.

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Film Production Gross Receipts Tax Deduction

  • This deduction primarily helps the in-state advertising industry by eliminating double taxation of amounts paid by qualified production companies to those selling or leasing production-related property and services.
  • Broad application to production costs, including payments for talent, management and labor, set construction, photography, facility and equipment rental among others.
  • A qualified production company executes nontaxable transaction certificates with its suppliers and vendors for tangible sale or leasing of personal property in New Mexico and services performed in New Mexico.
  • Suppliers then deduct their receipts from gross receipts tax.
  • Deduction offers a cost savings 6-8%.

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Film Investment Program

  • The State Investment Council negotiates terms for each project.
  • Up to $15M can be invested in a New Mexico film private equity fund or film project.
  • Equity investment can be up to 2/3 of estimated total production costs.
  • Guaranteed debt investment can be up to 100% of estimated total production costs.
  • In case of guaranteed debt, equity is in lieu of interest, with final maturity between two and four years.
  • Film project must be filmed wholly or substantially in New Mexico.
  • Film must have a contract with a reputable distribution company.
  • Company must agree that a majority of the production crew in New Mexico will be New Mexico residents.
  • Company must post a completion bond that has been approved by the New Mexico film division or other acceptable guarantee.

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Web Hosting Gross Receipts Tax Deduction

To encourage the development of clean, high technology businesses, New Mexico offers a gross receipts tax deduction for any company hosting Web sites in New Mexico.

  • Receipts from hosting Web sites may be deducted from gross receipts.
  • Applies to businesses that store information on computers attached to the Internet and that resell storage and interconnection capability.
  • Applies statewide.

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