Film companies would follow updated rules for Kentucky tax credits

Approved production companies may receive refundable Kentucky tax credits for qualifying production costs and payroll. Eligible companies filming or producing films, television programs, commercials, documentaries, video games, music videos, or touring Broadway shows in Kentucky are covered. Applicants must meet minimum spending levels that vary by company type and production type. Applicants must begin production within 180 days after approval and finish within two years of the production start date. Applicants must submit a certified audit, detailed cost reports, and proof that required income taxes were withheld. The total credit is limited to $75 million per calendar year, with a $25 million allocation for continuous film productions. The 180-day start deadline, two-year completion deadline, and annual credit limits apply as stated in the tax incentive agreement and the applicable calendar year.

The Kentucky Film Office reviews applications, and the Kentucky Film Leadership Council makes final decisions on tax incentive agreements after an economic analysis supports a project. The process applies to companies seeking Kentucky film and entertainment tax incentives and to the state office, council, cabinet, and Department of Revenue administering them. An application must be filed before the company incurs costs for which it seeks reimbursement. The council may approve an agreement only if the annual credit cap would not be exceeded. The agreement must be approved before production activity begins and then reviewed by the Government Contract Review Committee. The council may require an administrative fee of up to one-half of one percent of the estimated credit or $500, whichever is greater, plus a possible $2,000 agreement-preparation fee. The Film Office must notify an applicant within 30 days after receiving an application; companies must submit required reports and audits within 180 days after production ends.

The Kentucky Film Leadership Council must study the needs, opportunities, and barriers facing Kentucky musicians and music venues. The study covers musicians and music venues in Kentucky and must consider partnerships among state agencies, universities, and the music industry. The study must develop strategies for supporting industry growth and partnerships. The executive director of the Kentucky Film Office, the Economic Development Cabinet secretary, and the Education and Labor Cabinet secretary, or their designees, must conduct the study. The study findings must be submitted to the Legislative Research Commission by November 1, 2026, for referral to the listed legislative committee.