The Virginia Department of Taxation has updated the guidelines regarding the refundable corporate and personal income tax credits for motion picture production companies, which are available for tax years beginning on or after January 1, 2011. Under the updated guidelines, if a pass-through entity wishes to claim a credit at the entity level without allocating the amount of credit to the individual owners, the pass-through entity must notify the Virginia Film Office in writing at the time it submits its final application and, upon approval, must follow any instructions for claiming the credit as provided in the certification letter.
The guidelines also discuss definitions, production eligibility requirements, application process and procedures, as well as information on claiming the credit for the base-income tax credit, the additional Virginia resident credit, and the additional Virginia resident first-time industry employee credit. Additionally, the department notes that these guidelines supersede the Guidelines and Rules for the Virginia Motion Picture Production Tax Credit issued by the Department on December 21, 2010 (P.D. 10-281) and represent the department’s interpretation of the relevant laws, but do not have the force and effect of a law or regulation.
Ruling of Commissioner, P.D. 12-128 , Virginia Department of Taxation, August 6, 2012 , ¶205-684