Film Tax Credits by State (2026 Guide)

Film tax credits are the single biggest factor driving where productions actually shoot in 2026. A streamer or studio deciding between Atlanta, Albuquerque, and London is looking at the percentage credit, the qualifying spend rules, and the transferability — not the cinematography.

This guide is the working version: which US states and Canadian provinces have the most generous and most stable production incentives in 2026, how the credits actually work, and which markets are getting the work.

How Film Tax Credits Work (Briefly)

A film tax credit reduces a production's tax liability based on qualifying spend in the issuing state or province. The mechanics vary, but typically:

• A production spends qualifying dollars (crew labor, equipment rental, hotel, catering, etc.) in the issuing state
• The state issues a credit equal to a percentage of that spend (typically 20-40%)
• The credit is either:
  • Refundable (the state cuts a check if your credit exceeds your tax liability)
  • Transferable (you sell the credit to another taxpayer who needs it)
  • Non-refundable, non-transferable (only useful if you have in-state tax liability)

The most useful credits in 2026 are refundable or transferable. They effectively convert to cash for productions that don't have meaningful in-state tax liability — which is most outside-the-state productions.

A credit's actual value depends on:

• The percentage rate
• The base qualifying spend (some states qualify only crew labor; others qualify above-the-line, equipment, lodging, etc.)
• Caps per production and per year
• Bonuses (for shooting in specific zones, hiring local crew, post in-state, etc.)

Top US Film Production Markets by Tax Credit (2026)

State	Headline rate	Refundable / Transferable	Caps	Notes
Georgia	20% base + 10% logo	Transferable	No annual cap	The country's most generous and most stable. Drives Atlanta.
New Mexico	25-35% (uplift bonuses)	Refundable	$110M annual cap	Huge for series and features. Cap fills early in fiscal year.
New York	25-30% (with bonuses)	Refundable	$700M annual cap	Strongest in NYC metro; expanded post-2023 to compete with GA.
Illinois	30%	Transferable	No annual cap	Chicago-anchored. Stable. Used heavily by streamer episodic.
Louisiana	25% (with bonuses to 40%)	Transferable	$150M annual cap	New Orleans-anchored. Recent reforms strengthened predictability.
California	20-25% (program-dependent)	Non-refundable, transferable in limited cases	$330M annual cap	The home market. Surprisingly less generous than competitors on pure dollars.
Massachusetts	25%	Refundable	No annual cap (extended in 2024)	Boston-area features. Stable.
New Jersey	30-35% (with bonuses)	Refundable	$100M annual cap	Recent expansion. Adjacent to NYC.
Connecticut	30%	Transferable	$80M annual cap	Smaller market, growing
Pennsylvania	25-30% (with bonuses)	Transferable	$70M annual cap	Pittsburgh-anchored.
Texas	5-22.5% (program-dependent)	Grant-based, not credit	Variable	Austin-anchored. Less competitive than peers.
Oklahoma	20-30% (with bonuses)	Refundable	$30M annual cap	Smaller, growing market

These are headline rates; actual realized value depends on what spend qualifies and which uplifts apply.

Top Canadian Provinces by Tax Credit (2026)

Province	Headline rate	Type	Notes
Ontario	Up to 35% (combined federal + provincial)	Refundable	Toronto-anchored. Major streamer market.
British Columbia	Up to 35% (combined)	Refundable	Vancouver-anchored. Major streamer market.
Quebec	Up to 36-40% (combined, includes labor + service credits)	Refundable	Montreal-anchored.
Alberta	Up to 30% (Calgary + Edmonton zones)	Refundable	Smaller but growing
Manitoba	Up to 45% (with rural and frequent filming bonuses)	Refundable	Winnipeg-anchored.
Nova Scotia	Up to 32%	Refundable	Halifax-anchored.

Canadian credits often compound a federal credit (15% of qualifying labor) with a provincial credit. The combined effective rate is what matters for a production's economics.

What Qualifies as Spend

Every credit has its own definition. Some general patterns:

Category	Typically qualifies	Sometimes qualifies	Rarely qualifies
Crew labor (in-state)	Yes	—	—
Above-the-line (writer, director, producer)	Capped (often $500K-$1M per role)	—	Above the cap
Talent fees	Yes (often capped)	—	—
Equipment rental	Yes (if rented in-state)	Yes (if equipment is brought in but housed locally)	If brought in and removed
Construction / set materials	Yes	—	—
Locations and permits	Yes	—	—
Hotels and lodging	Yes	—	—
Catering and food	Yes	—	—
Post-production (in-state)	Yes	Yes (varies)	If done out of state
Music licensing / composer	Yes (if in-state)	Yes	If licensed from out of state
Insurance	Often	Sometimes	—
Travel (in-state portion)	Yes	—	Out-of-state air travel

The audit process is typically rigorous. Productions hire tax credit accountants or specialty firms (for example, Entertainment Partners, Cast & Crew, EP Cast & Crew, Wrapbook) to track qualifying spend and prepare the credit application.

Which Markets Are Actually Getting the Work in 2026

Tax credit value is one factor; infrastructure, crew supply, and political stability are the others. The markets that combine all four:

Tier 1: Atlanta (Georgia)

• 30% transferable credit, no cap, in place since 2008
• Major studios (Tyler Perry, Trilith, Shadowbox, EUE/Screen Gems)
• Deep crew bench (camera, G&E, sound, art, casting, locations)
• ~$4B+ qualifying spend per year, third-largest market in US

For more on Atlanta specifically, see Indie Film Production Companies in Atlanta.

Tier 1: Albuquerque (New Mexico)

• 25-35% refundable with uplift bonuses
• $110M annual cap (fills early)
• Major series and feature work, particularly streamers
• Smaller but stable crew bench, often imports key positions from LA

Tier 1: Toronto and Vancouver (Canada)

• Combined federal + provincial credits totaling 30-35%+ refundable
• Strong crew benches (especially Vancouver for VFX)
• Stable currency advantage for US productions

Tier 2: New Orleans (Louisiana)

• 25% with uplift bonuses to 40%
• Recent reforms strengthened predictability
• Smaller crew bench than ATL but growing

Tier 2: New York (NYC + state)

• 25-30% refundable
• Massive scripted production volume, particularly episodic TV
• High cost of doing business offsets some of the credit value

Tier 2: Chicago (Illinois)

• 30% transferable, no cap
• Strong commercial market in addition to scripted
• Episodic streamer production growing

Tier 3: Massachusetts, Connecticut, New Jersey

• Strong credits, smaller markets
• Often used for specific features or limited series

Tier 4: California (LA)

• The home market, but tax credit is less competitive
• Productions still shoot in LA for talent access, infrastructure, and creative reasons, despite the lower credit
• The LA Recovery Program (introduced 2024) expanded California credits but still trails Georgia and New York

How Productions Decide Where to Shoot

The decision matrix for a major production looks roughly like:

1. Tax credit value — biggest factor for productions over $20M budget
2. Crew availability — does the market have the crew the production needs
3. Infrastructure — sound stages, equipment houses, post facilities
4. Talent access — how far is talent willing to travel from their home market
5. Story requirements — does the script require specific locations
6. Operational complexity — visa requirements, language, time zones (for international)

For productions under $5M, the math often shifts toward operational simplicity (shoot near where the producer lives) rather than chasing the highest tax credit.

For productions over $20M, the tax credit math typically dominates. A 30% Georgia credit on $40M in qualifying spend = $12M of effective rebate, which is bigger than the difference between LA and Atlanta crew costs.

How Indie Producers Access Tax Credits

Indie productions can absolutely take advantage of state tax credits, but the threshold and complexity matter:

Minimum qualifying spend: Most state credits require minimum spend thresholds. Georgia is $500K. New York is $250K (NYC) or $1M (state). New Mexico has no minimum.

Structure: Productions form a state-specific LLC (a Georgia LLC for a Georgia shoot, etc.) and pay qualifying expenses through that entity.

Application: A pre-application or commitment letter is typically required before principal photography. The actual credit application happens after wrap, often 6-12 months later.

Audit: A qualified tax credit accountant audits the qualifying spend and prepares the credit application. This costs $5K-$25K depending on size of the production.

Monetization: For transferable credits, the production sells the credit at 85-95% of face value to a tax credit broker. The cash hits the production's account 6-18 months after wrap.

For most indie shorts under $50K, the tax credit isn't worth chasing — the accounting and legal cost outweighs the credit value. For indie features over $1M, the credit is usually worth the structure.

Where to Apply for Each Credit

Each state's film office is the starting point. Major film offices in 2026:

State	Film office	Notes
Georgia	Georgia Film Office	Strong support; pre-certification recommended
New Mexico	New Mexico Film Office	Application through state; cap fills early
New York	Empire State Development Film Tax Credit Program	Multi-step pre-application required
Louisiana	Louisiana Entertainment Office	Recent reforms; check current rules
Illinois	Illinois Film Office	Transferable; broker network active
California	California Film Commission	Multiple programs (regular, indie, relocation)

For Canada, each province has its own film office (Ontario Creates, Creative BC, SODEC for Quebec, etc.). Federal credits run through the Canadian Audio-Visual Certification Office (CAVCO).

What's Changed in 2025-2026

Three meaningful shifts:

1. California's Recovery Program (2024-2025). California meaningfully expanded its tax credit program in response to losing productions to Georgia and New York. The expansion narrowed but did not close the gap.

2. Massachusetts permanence (2024). Massachusetts made its film tax credit permanent (it was previously sunset-bound), stabilizing the New England market.

3. Louisiana reforms (2025). Louisiana cleaned up the bureaucratic complexity that had hurt the program in the late 2010s. New Orleans is back to being a competitive market.

Markets that didn't materially change in the period: Georgia (still dominant), New Mexico (cap fills, otherwise stable), New York (modest expansion of existing program).

How NeedaCrew Helps Productions in Tax-Credit Markets

NeedaCrew is the US/Canada marketplace for film crew and casting. The platform serves productions in all major tax-credit markets:

• Browse local crew by city — find Atlanta-based grips, NM-based DPs, Chicago-based ADs
• Post gigs with city + role + rate filters that local crew see first
• Direct messaging to qualified candidates
• City-specific rate ranges via the City Rate Browser

For productions structuring spend around tax credits, hiring local crew through the platform makes the qualifying-labor accounting cleaner.

Find local crew on NeedaCrew →

TL;DR

• Film tax credits are the single biggest factor driving where productions shoot in 2026
• Most generous + stable: Georgia (30% transferable), New Mexico (25-35% refundable), Louisiana (25-40% transferable)
• Canadian provinces (Ontario, BC, Quebec) often beat US states on combined federal + provincial credits
• For productions over $20M, tax credit math dominates the location decision
• For indie shorts under $50K, the accounting cost outweighs the credit value
• Refundable + transferable credits are the most useful; non-refundable, non-transferable credits often aren't worth chasing
• 2025-2026 changes: California Recovery Program expanded, Massachusetts permanence, Louisiana reforms

Find local crew on NeedaCrew →