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Louisiana’s Digital Interactive Media and Software Program, statutorily known as Digital Interactive Media and Software Tax Credit — the strongest of its kind in the nation — is helping innovative digital media and software development companies of all sizes gain a competitive edge.
on qualified payroll for in-state labor
on qualified production expenditures
No cap and no minimum requirement.
Tax credit can be applied to state income tax liability and the state will refund any overages OR applicants can opt for 85% of the value earned as a rebate any time during the year.
Complete application form online. In order for the application to be considered received, ALL information and fees (application and expenditure verification report deposit) must be submitted.
If approved, the Office of Entertainment Industry Development (OEID) issues Initial Certification.
Track project software development expenses.
An expenditure verification report is performed by an independent CPA assigned by OEID.
If approved, OEID issues Final Certification for the amount of the tax credit.
Claim the credit on Louisiana tax return and receive a refund, or at time of final certification, opt to receive an 85% rebate check option.
All incentive program rules are in the Louisiana Administrative Code maintained by the Office of the State Register. For rules, choose Title 61, Revenue and Taxation, and go to Part 1, Chapter 67.
The incentive is open to all companies producing digital interactive media products or platforms in Louisiana. Certain exclusions apply, such as static internet websites or software primarily designed for internal use, which are non-qualifying. Only work physically performed in Louisiana and only direct development equipment purchased through Louisiana businesses qualifies for the incentive.
Qualifying development products include:
What qualifies as a Louisiana business?
*Note: Eligible expenditures may start as early as, or no later than, six months from initial certification date (acceptance into the program) — R.S. 47:6022.
Eligible Labor Expenses
Non-Eligible Labor Expenses
Eligible Production Expenses
Non-Eligible Production Expenses
What is Digital Interactive Media?
In the context of Louisiana's Digital Interactive Media program, it's essentially an interactive software product (e.g. video game, training software, web platform, etc.) that's built for commercial export and not for the producer's internal use.
Is Louisiana's Digital Interactive Media Incentive a grant program?
NO. This is a performance based statutory incentive that provides tax credits for the development of eligible digital interactive media projects.
What can I do with the tax credits once I receive them?
You can apply any certified tax credits to offset your Louisiana state income tax liability. Since the credits awarded in the Digital Interactive Media Program are refundable, the remainder of the credits are considered an overpayment and refunded to the applicant by the Department of Revenue. There is also an option to take the value of the credits as a one-time rebate (any time during the year) at 85% of their original value.
Will I need to hire anyone to help me apply for the program?
OEID has full-time staff members whose job it is to help companies through the process of applying for and receiving the Digital Interactive Media tax credit. We strive to continually improve the transparency and ease with which firms can apply and enter the program.
Will I need to hire a CPA?
No, OEID will assign the CPA to complete an expenditure verification report.
How much will I receive back in tax credits for what I spent?
Digital Interactive Media applicants' qualifying projects are awarded up to a 18% tax credit on qualified production expenses paid to a Louisiana entity/vendor, and labor costs (for Louisiana residents) are awarded up to an additional 7% (an effective 25% total awarded on labor costs paid to Louisiana residents).
Can I still get tax credits for hiring out-of-state labor?
Any qualified expenditures can receive the tax credit award of 18%, regardless of whether the labor is performed by Louisiana residents, so long as the work is done 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.
What project expense costs qualify?
The simple answer is costs that are directly related to the project development itself. This includes items such as hardware and software, labor and lease costs — but not for costs associated with running the company (administrative, clerical, etc.) or marketing/distributing the product.
What is considered eligible equipment?
Equipment such as computer hardware and software purchased from a Louisiana business for the direct development of the product is considered eligible. Furniture and fixtures do not qualify for the program.
What's the difference between LED, Office, OEID, and Louisiana Entertainment?
The Office of Entertainment Industry Development is a division of the Louisiana Department of Economic Development. For ease of reading, this website may commonly refer to these entities as the Office, OEID, Louisiana Entertainment or LED.
What constitutes a purchase made in Louisiana?
An expenditure paid to a Louisiana company that has an active registration with the Louisiana Secretary of State and has a physical presence in the state, posted business hours and at least one full-time employee.
Is there a minimum investment?
For the Digital Interactive Media Program, there is no minimum spend required.
Is there a maximum for how many tax credits my project or company can receive?
There isn't a maximum amount of tax credits that a project or company can earn, nor is there a cap on the program as a whole.
Can this incentive be used in combination with other OEID incentives?
OEID has many business incentives, some of which may be combined with the Digital Interactive Media Incentive. OEID does not allow the same dollar spent to earn credits under multiple programs. Staff can work with your firm to see what you might be eligible for.
Can this incentive be used in combination with LED's Quality Jobs program?
A specific exclusion in the Digital Media Program prohibits a firm from taking advantage of both the additional Digital Media Incentive as well as LED's Quality Jobs program for the same employee. However, a firm may have some employees enrolled in the Quality Jobs program, while others are claimed under the Digital Media incentive.
Before I can apply, do I have to begin production or spend any money in the state?
An applicant can apply before beginning production or expending funds in Louisiana.
Where can I get help with Fastlane?
The FastLane Help Center is the best place for a user to go to find answers to typically asked questions when it comes to the FNG system.
Are H1-B or 1099 employees eligible for the additional resident payroll credit?
Payments made to employees with an H-1B temporary visa or independent contractors issued 1099 tax forms are not eligible for the additional resident payroll credit.
I started spending money in Louisiana before I received initial certification. Can I still claim what I've spent?
Under the law, a company can claim their first expenditure on a project up to six months prior to the date the application was received for the program.
How much does it cost to apply for each project?
.005 x proposed tax benefit with a minimum fee of $500 and a maximum fee of $15,000. Prior to the issuance of the initial certification letter, an expenditure verification report deposit shall be submitted accordingly to the following schedule:
If I apply, does that obligate me to do the production in Louisiana?
NO. An applicant to the Digital Interactive Media Program is not obligated to expend funds in the state — even after an application has been pre-certified.
How do I know if my project has been accepted into the program?
As soon as we've had a chance to review and clear up any outstanding issues in the application (which we strive to complete as quickly as possible), we will then send the applicant a Initial Certification Letter that acknowledges OEID gets a project's applicable expenditures of those proposed in the application.
Division Director, Digital Interactive Media & Software Development