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The Sound Recording Incentive Program, statutorily known as Sound Recording Investor Tax Credit, provides an 18% tax credit for sound recording projects made in the State of Louisiana. Louisiana also offers some of the world's finest talent and recording studios to complement the attractive financial benefits of recording in state. Sound recording investor tax credits are issued as rebates. The Sound Recording Investor Program provides:
for eligible production expenditures
Program is subject to a cap of $2.16 million per year. Projects are subject to a $100,000 cap, per year.
Complete application form. In order for the application to be considered received, ALL information and fees (application and expenditure verification report deposit) must be submitted.
If approved, LED/OEID issues Initial Certification.
Track production expenses.
Submit a cost report. Then, an independent CPA selected by LED/OEID will begin their review and submit an expenditure verification report to LED/OEID.
If approved, LED/OEID issues Final Certification for the amount of the tax credit.
Louisiana Department of Revenue issues a rebate check.
All incentive program rules are in the Louisiana Administrative Code maintained by the Office of the State Register. For rules, go to Part 1, Chapter 65.
The program incentivizes sound recording, defined as a recording of music, poetry or spoken-word performance made in Louisiana and produced in Louisiana in whole or in part. A $25,000 minimum in expenditures is required, with a $10,000 minimum expenditure requirement for Louisiana residents.
Qualifying sound recordings include:
Complete and submit the application and fee in its entirety to OEID. Projects under $15,000 are not subject to an application fee.
Once the application is complete, the project is evaluated for eligibility. Applicants to the sound recording production program must provide detailed accounting and verification of expenditures relating to All-In Producer Deals. Please refer to the producer fee policy notice.
Prior to the issuance of the initial certification letter, an expenditure verification report deposit shall be submitted accordingly to the following schedule.
If OEID determines that the project meets eligibility requirements of the statute and program rules, OEID issues an Initial Certification for that project or QMC.
The applicant signs the Initial Certification letter and returns it to OEID.
Upon project completion, the applicant must submit to OEID a cost report prepared by an independent CPA assigned by OEID to perform the cost report.
Upon receiving the cost report/audit, OEID reviews the report and may request additional supporting documentation.
After all supporting documentation is received and approved, OEID issues a Final Certification letter, confirming the certified amount that was spent in state and the certified amount of the tax credit the applicant will receive as a rebate.
Upon Final Certification, OEID submits the Final Certification letter to the Louisiana Department of Revenue (LDR) on behalf of the investor who earned the tax credit.
LDR may require the investor to submit additional information.
LDR issues tax credit to investor as a rebate.
How does this benefit my recording studio?
If you are a studio owner, you can market the tax credit as an incentive for talent to come to Louisiana or stay in Louisiana to record their album. They will get the tax credit, but you will get the business because the talent can get an up to 18% return on their investment.
What is the monetary value of the tax credit?
The tax credit is up to 18% of the base investment and is issued as a rebate. A rebate is a direct payment to the applicant from the Louisiana Department of Revenue. It is not necessary to establish taxable liability with Louisiana Department of Revenue to receive the rebate, but an applicant must have a Louisiana Tax ID in order to receive the rebate.
What is considered as base investment for the purposes of computing the tax credit?
Base investment is money spent in Louisiana that is directly related to the sound recording production project.
What does and does not qualify for the sound recording investor tax credit?
The only expenses that will qualify for the tax credit are those that are directly related to the production of a sound recording. For a production, qualifying expenses include, but are not limited to: travel (if purchased through a Louisiana travel agent), studio rental and fees, producer fee, composer fee, musicians' fees, and any other costs directly related to production. Non-qualifying expenses include, but are not limited to: distribution, marketing, promotion, advertising, expenses incurred but not paid, expenses paid to a business that is not located in the State of Louisiana, and any costs not directly related to the production.
What is a distribution plan?
A distribution plan will illustrate how an applicant plans to distribute a sound recording once it is finished. The distribution plan needs to be as detailed as possible. Will it go on sale at stores, over the Internet, through a distribution company, etc.?
What is a preliminary budget?
The preliminary budget should outline the anticipated sound recording production expenditures for the project.
What is the maximum tax credit amount my project can receive?
Can this incentive be used in combination with other LED incentives?
LED has many business incentives, some of which may be combined with the sound recording investor tax credit. Claiming identical expenditures for more than one LED incentive program is prohibited.
I started spending money in Louisiana before I received an Initial Certification. Can I still claim what I have spent?
YES. As long as a company can claim their first expenditure on a project 12 months prior to the date their project is approved (initially certified) 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.
When will I know if my project qualifies?
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.
When do I receive my tax credit?
Tax credits are issued as rebates following a project's Final Certification.
Executive Director of Louisiana Entertainment