Musical and Theatrical Production Tax Incentive

Whether you're launching a national concert tour or staging a new theatrical production, we'll help you hit your mark. Louisiana offers a unique tax incentive for musical and theatrical productions and state certified higher education musical or theatrical infrastructure projects.
  • Provides a 7.2% tax credit for certified Louisiana expenditures between $100,000 and $300,000.
  • Provides a 14.4% tax credit for certified Louisiana expenditures between $300,000 and $1,000,000.
  • Provides an 18% tax credit for certified Louisiana expenditures over $1,000,000.
  • Provides an additional 7.2% tax credit for payroll expenditures to Louisiana residents.
  • No cap on production expenditures.
  • The tax credit is refundable or transferable on a one time basis.
  • Additional tax credits are available when employing students enrolled in Louisiana.

Eligibility

Louisiana's musical and theatrical production income tax credit program is open to concert, theatrical and other live productions that originate or debut in the State of Louisiana. The musical and theatrical production income tax credit for infrastructure projects is available to state certified higher education musical or theatrical infrastructure projects. There is a $100,000 minimum in-state expenditure requirement.

Qualifying productions include:

  • Pre-Broadway engagement or remounts
  • Tour or resident production remounts
  • Pre-Broadway tryouts
  • Resident or regional productions
  • National touring companies producing their first public performance in Louisiana
  • Concert tours producing their first public performance in Louisiana

Eligible production expenditures:

  • Salaries directly related to the development of in-state certified productions
  • Physical production costs directly related to an in-state certified production
  • Artist compensation directly related to performance days in Louisiana
  • Creative team compensation directly related to work performed in Louisiana
  • Local and touring crew compensation directly related to work performed in Louisiana
  • Hotel and airfare expenditures directly related to an in-state certified production
  • Venue rental and associated fixed costs

Qualifying infrastructure projects include:

  • State certified higher education musical or theatrical infrastructure projects

Example infrastructure expenditures may include:

  • Land and acquisition
  • Construction
  • Design 
  • Furniture, fixtures and equipment

Program Statutes & Rules: 

All incentive program rules are in the Louisiana Administrative Code maintained by the Office of the State Register.

 


Getting Started

To take advantage of the Musical and Theatrical Production Income Tax Credit, review the process and download the documents below:


Next Steps

Initial Certification (60-90 business days)

1. Complete and submit the application and supporting documents in their entirety to Louisiana Entertainment.

2. Effective January 1, 2016, a deposit fee shall be remitted to Louisiana Entertainment for the verification fee. At the time of application, the applicant shall be required to submit a deposit of the expenditure verification report fee of $2,500 for a production or project with qualified expenditures projected to be between $5,000 and $50,000, and a deposit of $5,000 for those projected to be in excess in $50,000.

The applicant will be assessed the department's actual cost for the expenditure verification report fee. The maximum fee shall be $5,000 for verification of a cost report of production or project expenditures reflecting expenditures of between $5,000 and $50,000, and the maximum fee shall be $15,000 for verification of a cost report reflecting expenditures in excess of $50,000.

3. Once the application is complete, the project is evaluated for eligibility.

4. If Louisiana Entertainment determines that the project meets eligibility requirements of the statute and program rules, Louisiana Entertainment issues an Initial Certification letter for that project.

5. The applicant signs the Initial Certification letter and returns it to Louisiana Entertainment.

Final Certification (60-90 business days)

1. Upon completion of the project, an expenditure verification report is prepared by an independent Louisiana CPA selected by Louisiana Entertainment. 

2. In addition to expenditure verification report, the following information may be requested:

  • Full general ledger(s) — any and all data detailing expenditures (in-state and out-of-state) related to the production
  • Full payroll data — any and all data related to payroll associated with the production or infrastructure project
  • Invoices, contracts and proof of payment for certain transactions may be required by LED
  • Verification of Louisiana payroll expenditures through review of Declaration of Residency form(s) by CPA

3. After all supporting documentation is received and approved, Louisiana Entertainment issues a Final Certification letter, confirming the certified amount that was spent in state and the certified amount of tax credits the applicant will receive.

Issuance of Credits (30-45 business days)

1. Upon Final Certification, Louisiana Entertainment submits the Final Certification letter to the Louisiana Department of Revenue (LDR) on behalf of the investor who earned the musical and theatrical production income tax credits.

2. LDR may require the investor to submit additional information.

3. LDR issues tax credits to investor.


Eligibility Scenarios

Q. The Rolling Stones and The Lion King are launching their North American tours in Louisiana. Would these productions qualify for the Musical and Theatrical Production Income Tax Credit?
A. YES. Pre-production, running costs and artist guarantees would qualify for tax credits. Only expenditures relating to production activity in Louisiana would qualify for tax credits, and any expenditures relating to out-of-state production activity would be disallowed.

Q. New Orleans is a stop on the North American tours of both the Rolling Stones and The Lion King. Would these productions qualify for the Musical and Theatrical Production Income Tax Credit?
A. No. Neither of these productions would fulfill the statutory requirement that productions originate or debut in Louisiana.

Q. I have purchased an old historic theater in Louisiana that has been out of use for some time. Would this project qualify for the infrastructure incentive program and would the cost of purchasing as well as renovating the theater qualify?
A. No. Only state certified higher education musical and theatrical infrastructure projects qualify for the incentive program.

Q. I'm thinking about opening a venue that serves lunch, has a great happy hour and features bands a few nights a week with a cover charge at the door. Would this project qualify for infrastructure credits?
A. No. Only state certified higher education musical and theatrical infrastructure projects qualify for the incentive program.


FAQS

Q. How does the program define a qualified musical or theatrical production?
A. Louisiana's Musical and Theatrical Production Incentive Program is open to concert, theatrical and other live productions that originate or debut in the State of Louisiana.

Q. Do not-for-profit organizations qualify for the program?
A. Yes. Although it is necessary to establish taxable liability with the State of Louisiana, it is not necessary to owe taxes. Not-for-profit organizations are issued credits in the form of a "refund of overpayment" by the Louisiana Department of Revenue.

Q. What is a tax credit?
A. A tax credit is a credit that can be used against Louisiana tax liability. In the case of the musical and theatrical production income tax credits, the credits are refundable or transferrable.

Q. What can I do with these tax credits?
A. Musical and theatrical production income tax credits are refundable or transferrable.

Q. Will I need to hire a CPA?
A. Yes. 
State law requires that projects that apply or submit a request for final certification on or after January 1, 2016, shall be required to use a CPA selected by Louisiana Entertainment. Any project that is currently initially certified or that will apply on or before January 1, 2016 may: 

  1. engage a CPA of their choice and submit a cost report prepared by the CPA with their request for final certification on or before December 31, 2015, or 
  2. elect to use a CPA assigned by Louisiana Entertainment, but must submit the advance deposit upon making this request. 

Q. Can I get tax credits for payroll of out-of-state residents?
A. Any qualified expenditures can receive the tax credit award up to 18%, (25% as of July 1, 2018) regardless of whether the labor is performed by Louisiana residents, as long as the work is performed in the State of Louisiana. All labor must be verified to have been performed in Louisiana, and any work performed outside of the state would not qualify.

Q. Is there a minimum amount I have to spend in order to receive credits?
A. The minimum that must be expended in Louisiana is $100,000 in Louisiana on the project(s) for which the application is made.

Q. What is the maximum amount in tax credits my project can receive?
A. There are no per-project or program caps on musical and theatrical production income tax credits. Musical and theatrical production infrastructure income tax credits are capped at $7.2 million per project ($10 million effective July 1, 2018) with a $60 million annual state cap ($43.2 million between July 1, 2015 and June 20, 2018).

Q. Can this incentive be used in combination with other Louisiana Entertainment incentives?
A. Louisiana Entertainment has many business incentives, some of which may be combined with the musical and theatrical production income tax credit. Claiming identical expenditures for more than one Louisiana Entertainment incentive program is prohibited.

Q. Is there an application fee?
A. Yes. The fee is assessed as 0.5% (0.005) of proposed tax benefit in Louisiana with a $500 minimum fee and $15,000 maximum fee. Make check or money order payable to Louisiana Economic Development. No cash is accepted. The fee is non-refundable.

Q. When will I know if my project qualifies?
A. As soon as we have had a chance to review and clear up any outstanding issues in the application (which we strive to complete as quickly as possible), we issue an Initial Certification that acknowledges a project's applicable expenditures based on those proposed in the application. The Initial Certification is not a tax credit; rather, it is a certification that the project is qualified to potentially earn tax credits.

Q. When do I receive my tax credits?
A. Tax credits are issued following a project's Final Certification.