All Roll Calls
Yes: 212 • No: 5
CaliforniaAB 11382025-2026 Regular SessionHouseWALLET
Income and corporate taxes: tax credits: motion pictures.
Sponsored By: Benjamin Allen (Democratic), Isaac Bryan (Democratic), Sharon Quirk-Silva (Democratic), Rick Chavez Zbur (Democratic)
Signed by Governor
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Bill Overview
Analyzed Economic Effects
23 provisions identified: 11 benefits, 1 costs, 11 mixed.
California film credit: 20%–25%
Productions that qualify in California get a tax credit equal to 20% or 25% of qualified spending. This applies to taxable years beginning on or after January 1, 2020. You cannot claim the same costs under other listed state credits. The California Film Commission (CFC) rules define who and what expenses qualify.
Credits for certified soundstages and studios
The certified studio construction program has $150 million in total credits. Before 2025, a project can get up to the greater of $12 million or $750,000 per episode. On or after 2025, the cap is the greater of $21 million or $1.3 million per episode. To qualify, a production must shoot at least 50% of stage days on certified stages and pay at least $5 million in qualified wages there. For years before 2025, the producer must be majority‑owned by the stage owner or have a 10‑year or longer contract or lease, and must have an approved diversity workplan. Unused studio‑construction credits can be carried forward for up to eight years.
Extra credits for filming outside LA, VFX
Productions earn a 5% bonus for original photography outside the Los Angeles zone and 5% for qualified visual effects done in California. Wages paid to California residents who live outside the LA zone can earn an extra 10% or 5%, depending on production type. For ranking, the CFC counts 70% of in‑state third‑party VFX vendor spending as wages in the jobs ratio.
Guaranteed credits for returning TV seasons
A TV series that received a credit allocation gets a credit for each later season when credits are allocated. The series must request its next allocation within 18 months after principal photography ends on the prior season or it loses the guarantee. The Commission may cap the amount at the recurring‑TV share and can redirect credits from other categories to cover shortfalls. It may also shift up to 25% of the 2029–30 pool to support recurring series earlier; those shifted amounts are not certified until July 1, 2030 or later.
Higher California film and TV credits
Beginning January 1, 2025, most productions get a 35% credit on qualified spending. A TV series that relocates to California gets 40% in its first allocation year. You can earn up to 5% more for original photography outside the Los Angeles zone and for California visual effects, combined. You also get an extra 10% or 5% on certain wages paid to California residents who live and work outside the Los Angeles zone. If you meet an approved diversity workplan, the Commission can raise your credit percentage by up to four points.
How credits are ranked and allocated
The CFC can allocate up to $330 million in credits each year through 2024–25, plus set add‑ons. In 2021–22 and 2022–23, an extra $15 million went to relocating TV series and $75 million to recurring TV. The annual pool is split: 35% features; 17% relocating series; 40% new/recurring TV; and independent films get 4.8% (≤ $10 million budget) or 3.2% (> $10 million). The CFC runs two or more allocation periods per year (through July 1, 2025), ranks projects by a jobs ratio, and may boost it by up to 25%; some projects get a 1.33x multiplier. Starting July 1, 2025, the CFC may reallocate previously allocated but uncertified credits back into the pool.
Jobs ratio boosts for some productions
The Film Commission ranks applicants by a jobs ratio and allocates from highest to lowest. It can raise a project’s jobs ratio by up to 25% if it shows extra California economic activity under Commission rules. Some qualifying projects get a 1.33× multiplier on their jobs ratio. A higher final ratio improves your place in line for credits.
Bigger film and TV credits starting 2025
Beginning with tax years starting January 1, 2025, the base credit is 35%. A relocating TV series can get 40% in its first year. You can add up to 5 extra points for filming outside the Los Angeles zone and for California visual effects. You also get a 10% or 5% wage bonus for California residents who live outside the Los Angeles zone. The per‑project spending cap used to compute the credit rises to $120 million. A relocating TV series can also get up to a $4 million top‑up. The federal research credit cannot be used with these California credits.
More and faster credit allocations
For fiscal years 2020–21 through 2024–25, the state allocates $330 million in credits each year. In 2021–22 there is an extra $15 million for relocating TV series, and in 2022–23 an extra $75 million for recurring TV series. Each year, 35% goes to features, 17% to relocating TV, 40% to new and recurring TV, and 8% to independent films (4.8% small, 3.2% larger). From July 1, 2025 to July 1, 2030, the Commission runs four or more allocation rounds per year and can add up to 2% to allocations when productions employ Career Pathways trainees. The Commission can reallocate previously allocated but uncertified credits starting July 1, 2025, and again on or after July 1, 2030.
Penalties if jobs fall short
After production, the Commission recalculates the jobs ratio. If it drops by more than 10%, your credit is cut by the same percent unless you show reasonable cause. If it drops by more than 20%, you and your controlled group cannot apply for at least one year unless you show reasonable cause. Reasonable cause means unforeseen events beyond your control, like a series cancellation, as defined by Commission rules.
Assign, sell, or carry film credits
You can assign part of your credit to 100%‑owned affiliates; single‑member LLCs may elect to assign as if treated as corporations. Credits from independent films may be sold once to an unrelated buyer if you report the buyer and terms to the Franchise Tax Board before the sale. For pass‑throughs, the credit passes to partners or S‑corp shareholders. If your credit is bigger than your tax, you can carry it forward—generally up to nine years (some independent‑film sales allow up to eight). Assignees and purchasers are treated as qualified taxpayers and must follow the rules; the FTB can disallow duplicate claims. Credits that were assigned and claimed on a timely filed return on or before January 1, 2025 by disregarded single‑member LLCs remain eligible for assignment to their owner or affiliates.
Bigger credits at certified studio projects
A separate credit applies to productions at certified studio construction projects for taxable years starting on or after January 1, 2022 and before January 1, 2032. Credits allocated before July 1, 2025 are 20% or 25%; allocations on or after July 1, 2025 are 35% or 40%. The CFC may allocate up to $150 million a year under this pool, with per‑production caps: before 2025, up to $12 million or $750,000 per episode; on/after 2025, up to $21 million or $1.3 million per episode. Projects must spend at least $25 million on construction/renovation (over ≤ 5 years); productions must film at least 50% of stage days on certified soundstages and pay at least $5 million of qualified wages there, and have an approved diversity workplan. Meeting diversity goals can add up to 4 percentage points to the credit; a 0.5% training program payment is required.
Get 4% more with a diversity plan
By default, the Commission certifies 96% of your allocated credit. If you submit a diversity workplan within 30 days and meet the goals or show good‑faith effort after interim and final checks, you can get the extra 4% certified. Independent films with $10 million or less in qualified spending are exempt from this extra‑certification process. Some recurring TV series may follow alternative diversity/report rules set by the Commission.
Jobs ratio boosts and penalties
For certain listed productions, the jobs ratio used to rank applicants is multiplied by 1.33. After production, the Commission recomputes the jobs ratio. If it drops by more than 10% from the application, your allowed credit is cut by the same percent unless you show reasonable cause. Reasonable cause includes unforeseen events beyond your control, like a TV series being canceled.
Per‑project caps and claim timing
The Commission counts at most $120 million of spending per feature, limited series, or TV season when it calculates the credit. It counts at most $20 million for an independent film. Under earlier rules, independent films are capped at $10 million in spending counted. You can claim the credit only in the year the Commission issues your certificate, and not for any year before July 1, 2025. Starting January 1, 2025, a publicly traded company may own up to 30% of an independent‑film producer for this credit.
Stronger audits; missing copyright loses credit
Before issuing a credit certificate, the Film Commission verifies final spending, checks the required safety report, and completes audits. To claim the credit, you must submit detailed records, workforce diversity data, Career Readiness proof, and proof of fee payment. If you do not provide the required copyright registration number, the credit is disallowed and assessed until you provide it. Your submissions are treated as confidential tax information, and the Commission gives application materials to the Legislative Analyst’s Office on request. For 2020–21, the Commission may use emergency rules to run the program.
Studio credit tied to prevailing wages
For certified studio construction projects, each year after construction you must report operation and maintenance pay. If 90% or more goes to workers at the prevailing per diem wage, you get 100% of the credit. If 75% to under 90%, you get 50%. If under 75%, you get no credit for that period.
Larger credit pool and flexible allocations
From fiscal years 2025–26 through 2029–30, the state can allocate up to $750 million in film credits each year. Between July 1, 2020 and June 30, 2025, the Commission runs two or more allocation rounds each year. If there are not enough credits for recurring TV series, the Commission can move credits from relocating series, then new series, then features until the gap is closed. It can also pull up to 25% of 2029–30 credits into the current year to cover shortfalls.
Ongoing credits for recurring TV series
If a TV series has been approved and allocated a credit, the CFC issues a credit for each later season while credits are allocated that year. Different limits apply before and after January 1, 2025. You must request the next allocation within 18 months after the prior season’s principal photography ends, or you waive the guarantee and must reapply. The CFC follows ordered steps to handle any shortfall and keep series whole where possible.
New application, data, and audit rules
You must apply on a CFC/FTB form and include budget, days, financing, expected wages and credit, diversity details, a location statement, and anti‑harassment policy. To claim the credit, you must give the CFC worker IDs, production dates, wage totals, diversity data, your copyright registration number, proof of qualified spending, Career Readiness completion, and proof of fee payment. The CFC verifies and audits before it certifies the final credit amount. Applicant information the CFC holds is treated as confidential tax information, but the CFC must give application materials to the Legislative Analyst’s Office on request and collect data from non‑allocated applicants. Starting June 30, 2027, the CFC sends the Legislature an annual report with diversity results. The CFC must adopt rules; GO‑Biz must pre‑approve rules on allocations, jobs ratio, and “reasonable cause,” and no economic impact study is required for these rules.
Training fee and hiring bonus for productions
Productions that get a credit must pay a Career Pathways training fee: 0.5% of the approved credit (0.25% for independent films). Starting January 1, 2028, the Commission may raise the fee by 0.25 points per year, up to 1%; independent films are exempt from these increases. The Commission can add up to 2% to your allocated credit if you employ Career Pathways trainees. The program expands nonprofit partners through RFPs (first before the first allocation; another by July 1, 2027) and focuses on adults from underserved communities. By July 1, 2026, the Commission sets rules to place 1–4 trainees without displacing expected hires, and trainee wages are excluded from jobs‑ratio wage calculations.
More public reporting on film credits
The Film Commission posts each year who got credits, amounts, jobs, days, and expected spending, plus a staff summary and aggregate diversity data. Starting January 1, 2022, it also sends the Legislature an annual diversity report. It gives tax agencies a yearly list with taxpayer names and ID numbers for allocated credits. The Commission tries to get outcomes from applicants who did not receive allocations and shares a guide and a list of local production incentives with cities, counties, and approved applicants.
Extra review for Film Commission rules
Before proposing key rules on credit allocations, jobs‑ratio calculations, or the definition of “reasonable cause,” the Film Commission must get approval from the Governor’s business office. For these rules, the Commission does not have to prepare an economic impact study. The Commission is authorized to allocate credits once required rules are adopted.
Sponsors & Cosponsors
Sponsors
Benjamin Allen
Democratic • Senate
Isaac Bryan
Democratic • House
Sharon Quirk-Silva
Democratic • House
Rick Chavez Zbur
Democratic • House
Cosponsors
Patrick Ahrens
Democratic • House
Benjamin Allen
Democratic • Senate
Josh Becker
Democratic • Senate
Isaac Bryan
Democratic • House
Jessica Caloza
Democratic • House
Celeste Celeste Rodriguez
Democratic • House
Sade Elhawary
Democratic • House
Mike Fong
Democratic • House
Mike Gipson
Democratic • House
John Harabedian
Democratic • House
Tom Lackey
Republican • House
Mark Mark González
Democratic • House
Tina McKinnor
Democratic • House
Caroline Menjivar
Democratic • Senate
Caroline Menjivar
Democratic • Senate
Michelle Michelle Rodriguez
Democratic • House
Al Muratsuchi
Democratic • House
Liz Ortega
Democratic • House
Sasha Renée Pérez
Democratic • Senate
Sharon Quirk-Silva
Democratic • House
Susan Rubio
Democratic • Senate
Pilar Schiavo
Democratic • House
Nick Schultz
Democratic • House
Catherine Stefani
Democratic • House
Henry Stern
Democratic • Senate
Suzette Martinez Valladares
Republican • Senate
Anamarie Ãvila FarÃas
Democratic • House
Roll Call Votes
House vote • 7/3/2025
Item 1000 — Assembly AFLOOR
Yes: 69 • No: 1
Senate vote • 7/3/2025
Item 133 — Senate SFLOOR
Yes: 32 • No: 2
legislature vote • 6/30/2025
Vote in CS61
Yes: 6 • No: 0
legislature vote • 6/26/2025
Vote in CS83
Yes: 5 • No: 0
House vote • 6/3/2025
Item 192 — Assembly AFLOOR
Yes: 73 • No: 1
legislature vote • 5/23/2025
Vote in CX25
Yes: 13 • No: 0
legislature vote • 4/28/2025
Vote in CX19
Yes: 6 • No: 1
legislature vote • 4/22/2025
Vote in CX37
Yes: 8 • No: 0
Actions Timeline
Chaptered by Secretary of State - Chapter 27, Statutes of 2025.
7/3/2025SenateApproved by the Governor.
7/3/2025legislatureEnrolled and presented to the Governor at 11 a.m.
7/3/2025legislatureIn Assembly. Concurrence in Senate amendments pending.
7/3/2025HouseUrgency clause adopted. Senate amendments concurred in. To Engrossing and Enrolling. (Ayes 69. Noes 1.).
7/3/2025HouseAssembly Rule 63 suspended.
7/3/2025HouseRead third time. Urgency clause adopted. Passed. Ordered to the Assembly. (Ayes 32. Noes 2. Page 1918.).
7/3/2025SenateRead second time. Ordered to third reading.
7/1/2025SenateFrom committee: Do pass. (Ayes 6. Noes 0.) (June 30).
6/30/2025SenateFrom committee: Do pass and re-refer to Com. on APPR. (Ayes 5. Noes 0.) (June 26). Re-referred to Com. on APPR.
6/26/2025SenateFrom committee chair, with author's amendments: Amend, and re-refer to committee. Read second time, amended, and re-referred to Com. on REV. & TAX.
6/24/2025SenateFrom committee chair, with author's amendments: Amend, and re-refer to committee. Read second time, amended, and re-referred to Com. on REV. & TAX.
6/23/2025SenateReferred to Com. on REV. & TAX.
6/18/2025SenateIn Senate. Read first time. To Com. on RLS. for assignment.
6/4/2025SenateRead third time. Passed. Ordered to the Senate. (Ayes 73. Noes 1. Page 2014.)
6/3/2025HouseAssembly Rule 69(d) suspended. (Page 2013.)
6/3/2025HouseRead third time and amended. Ordered to third reading. (Page 1953.)
6/2/2025HouseRead second time. Ordered to third reading.
5/27/2025HouseRead second time and amended. Ordered returned to second reading.
5/23/2025HouseFrom committee: Amend, and do pass as amended. (Ayes 13. Noes 0.) (May 23).
5/23/2025HouseAssembly Rule 63 suspended. (Ayes 51. Noes 16. Page 1644.)
5/23/2025HouseJoint Rule 62(a), file notice suspended. (Page 1627.)
5/21/2025HouseIn committee: Set, first hearing. Referred to APPR. suspense file.
5/21/2025HouseIn committee: Hearing postponed by committee.
5/14/2025HouseFrom committee: Do pass and re-refer to Com. on APPR. (Ayes 6. Noes 1.) (April 28). Re-referred to Com. on APPR.
4/29/2025House
Bill Text
Chaptered
7/3/2025
Enrolled
7/3/2025
Amended Senate
6/24/2025
Amended Senate
6/23/2025
Amended Assembly
6/2/2025
Amended Assembly
5/23/2025
Amended Assembly
4/22/2025
Amended Assembly
3/28/2025
Introduced
2/20/2025