Frequently Asked Questions

Are we required to name our irrevocable designee when we apply for initial certification?

Answer: You are not required to name your irrevocable designee when you apply for initial certification. A production company can legally name an irrevocable designee at any point from your initial certification up until the day the final certification and issuance of the tax credits by Louisiana Economic Development.

Do we still have to pay the State a 2% fee when we receive the funds from our irrevocable designee?

Answer: No. The 2% fee is only applicable for the tax credit recipient who accepts the 90% buyback and transfers the credits back to the State of Louisiana.

Why is this technically a loan from a taxpayer that is repaid with tax credits?

Answer: Since 2017, Louisiana law has (regrettably) not allowed the sale or transfer of motion picture tax credits once they are issued by the State. However, the law clearly allows a production company to name a bank or other lender as an irrevocable designee who can receive the credits when they are issued. The taxpayer is essentially loaning you money until the credits are issued directly to them as your irrevocable designee. Once the taxpayer receives the credits, the loan is considered repaid in full.

When can Irrevocable Designee LLC find our company a Louisiana taxpayer who can serve as our irrevocable designee?

Answer: The more information we have about your project, the easier it is for us to find a Louisiana taxpayer who could be a perfect match for your production. The most important pieces of information we will need from you will be the status of your production, where it stands in the process, and the amount of tax credits you anticipate being issued. The closer your production is to the State’s independent audit process or the further along your project is in that audit process, the faster it becomes for us to find your perfect match.

Knowing that the State of Louisiana is offering a net $.88 on the dollar to sell our tax credits back to the Louisiana Department of Revenue, how much can we expect to receive from our irrevocable designee?

Answer: That depends. If your production is in the audit process, our goal is to make sure you net more than the $.88 on the dollar that the State offers as soon as your audit is completed. Remember, every taxpaying irrevocable designee is as unique as your production, but they are all looking to save enough to make helping you worth their while. For example, you can almost be assured that you will not get $.95 on the dollar for your credits if other forms of tax credits are readily available at $.92 on the dollar.

However, some Louisiana taxpayers might be willing to take on more risk and loan at a rate of less than $.88 at an earlier point in your development or production process. And still, others may not want to loan the money until just before the credits are issued. It is our job to get to know the taxpayers and their appetites for credits, tax savings, and risk.

Can Irrevocable Designee LLC find our production company a taxpayer who will take on more risk and possibly become a stakeholder or an investor in our project?

Answer: Often referred to as “cash flowing” there are some taxpayers who might be willing to take on a greater risk and loan your production company the money for your credits before the production even begins, or possibly becoming an equity investor in your project, in exchange for your tax credits and some ownership in your project. However, while it is our goal to one day help potential accredited investors find worthy Louisiana projects, our primary focus for 2025 is to help audited projects monetize their credits faster.

Can I use motion picture tax credits issued in 2025 to offset my 2024 Louisiana state income liability? 

Answer: At present, motion picture tax credits issued in 2025 cannot be used to offset a prior year’s income tax liability in Louisiana. However, motion picture tax credits issued in 2025 are good for five years. In fact, you are allowed to use any portion of the credits you receive in 2025 to reduce your state income tax liability this year until your credits are exhausted or until the credits expire after the 2029 tax year.

Can I use motion picture tax credits to offset my estimated quarterly state income tax payments in Louisiana?

Answer: Yes! Please consult with your CPA or tax professional for more information on using credits for your quarterly payments.

Can I sell the credits to another taxpayer if I decide I no longer want them?

Answer: Once issued, motion picture tax credits cannot be transferred to another tax taxpayer under the present law. However, they can be transferred back to the Louisiana Department of Revenue for a net $.90 on the dollar minus a 2% transfer fee (net $.88). 

How can my use of motion picture tax credits actually benefit Louisiana and our film industry?

Answer: By becoming an irrevocable designee and reducing your state income tax liability by at least 7.5%, you are actually speeding up the monetization process for a production company by months. That makes Louisiana a much more attractive place to base a film or television series production. Those productions create jobs and put money in our local economies. 

So…how much does it cost to hire Irrevocable Designee LLC?

Answer: That is the best part: It costs you nothing!  Irrevocable Designee LLC actually exists to save you money. We deduct a fee from the proceeds loaned to the production company at the closing of your transaction.  The price per credit that you agree to loan the production company is inclusive of all costs of the transaction.

You save money on your taxes. The production company receives more money than the State of Louisiana offers, and they receive it much faster than the wheels of state government can turn. And the end result is the State of Louisiana becomes an even more attractive place for everyone to do business. 

That is what we call a win-win-win!