DIGEST
The digest printed below was prepared by House Legislative Services. It constitutes no part of the
legislative instrument. The keyword, one-liner, abstract, and digest do not constitute part of the law
or proof or indicia of legislative intent. [R.S. 1:13(B) and 24:177(E)]
CONFERENCE COMMITTEE REP ORT DIGEST
HB 735 2015 Regular Session Stokes
Keyword and oneliner of the instrument as it left the House
TAX/INCOME TAX: Requires the withholding of individual income taxes from income earned by
certain individuals for purposes of the motion picture investor tax credit
Report adopts with technical changes Senate amendments to:
1. Delete the requirement for annual electronic reporting of a list of payees by production
company or payroll services company.
2. Change requirements for reporting with respect to related party transactions from those
involving a payee's relation to a loan-out company to those involving a production company's
relation to a loan-out company.
Digest of the bill as proposed by the Conference Committee
Present law allows a motion picture investor tax credit in an amount equal to a certain percentage
of the "base investment" made in a state-certified production. The "base investment" is a cash or
cash equivalent investment made and used for "production expenditures" in the state. "Production
expenditures" includes compensation paid to employees for services related to the production.
Proposed law specifies that any individual receiving any payments for the performance of services
used directly in a production activity, and claimed as a production expenditure for certification of
a tax credit (individual), is deemed to be receiving La. taxable income whether directly, or indirectly
through an agent or agency, loan-out company, a personal service company, an employee leasing
company, or other entity.
Proposed law provides that any motion picture production company, motion picture payroll services
company, or other entity (company) making or causing to be made payments to an individual, or to
an agent or agency, loan-out company, personal service company, employee leasing company, or
other entity is considered to be paying compensation taxable by the state. For purposes of eligibility
of payments for certification of tax credits, the company is required to withhold taxes from those
payments at the rate of 6%. Proposed law requires the company to electronically report and remit the withholdings made
pursuant to proposed law to the Dept. of Revenue quarterly. The Dept. of Revenue is authorized to
share with the Dept. of Economic Development information contained in the report, in accordance
with confidentiality requirements of present law regarding the exchange of information between
these two departments. The report shall contain the following information:
(1)Name, address, and taxpayer identification number of the loan-out company, if any.
(2)Identification of entity type: C Corp; S Corp; L.L.C; or other entity with tax type specified,
if applicable.
(3)Name, address, and social security number of the payee.
(4)An estimated amount of what the loan-out company will pay the payee, if applicable.
(5)An affirmative statement of whether the production company is a related party to the loan-out
company, and if so, provision of an affidavit stating that the transaction is valued at the same
value that an unrelated party would value the same transaction. Further, if the production
company is a related party to the loan-out company, the reports required relative to income
withholding shall also contain information on the ownership structure of the loan-out
company, and an estimate amount of what the loan-out company or other entity will pay the
payee.
Proposed law authorizes the Dept. of Revenue to collect a one-time fee of $200 per production for
purposes of administering the reporting provisions required by proposed law.
Proposed law redefines "payroll" for purposes of the motion picture investor tax credit to include per
diem, housing, box rentals, and any other type of benefit paid to an individual for the performance
of services in a production. Proposed law further requires taxes to be withheld and remitted to the
Dept. of Revenue in accordance with proposed law in order for the payroll to be qualified as "base
investment" for purposes of the tax credit.
Applicable to productions receiving initial certification on or after Jan. 1, 2016.
(Amends R.S. 47:164(D) and 6007(B)(8) and (D)(5))