$14 million of Oregon Income Tax Credits will be Auctioned from September 30th to October 4th, 2020.
The Oregon Production Investment Fund, or OPIF, is a state-run incentive program that supports the growth and development of creative film, television, and interactive industries here in Oregon. In the last two years alone, the program tracked $300 million of in-state spending and helped create more than 5,000 local jobs.
Funding for OPIF comes from an annual auction of discounted Oregon income tax credits. Oregon residents and business owners can bid on these discounted income tax credits at up to a 10% discount. Bidders are able to choose how many tax credits they’d like to bid on in increments of $500.
This means that if you wanted to buy a single $500 tax credit, the bidding would start at $450 (10% off of $500). Similarly, if you wanted to buy $50,000 worth of tax credits you may only pay $45,000, saving you $5,000 or 10% on your yearly income taxes. Tax credits are valid for three years and must be used to offset your personal or business Oregon income tax liability.
Supporting this program allows you to ensure your tax dollars are going to a program you support, while saving you money on income taxes you’ll have to pay anyway. In addition to saving money and supporting our local economy, you’ll help fund projects like "First Cow," "Shrill" (Hulu), "Trinkets" (Netflix), "Documentary Now!" (IFC) and "Pretty Little Liars: The Perfectionists" (WB).
Oregon Film is statewide and the economic benefits are too. In the last two years, large-scale productions have spent money in Klamath Falls, Astoria, Elkton, Bandon, Bend, and Vernonia.
Credits bought through OPIF can be used by individuals and businesses alike and should be used on their Oregon Tax Returns. For businesses, the IRS has clarified the ways in these tax credits may be deducted as a business expense in many cases (and this can also save you additional dollars on local business income taxes, such as the City of Portland Business License Fee and Multnomah County Business Income Tax). Another benefit is that these credits reduce the tax you owe, so if you might be subject to Oregon estimated tax underpayment penalties or interest, this may help you reduce or eliminate those too!
The OPIF Tax Credit Auction takes place from Monday, September 30th at 9am, to Friday, October 4th at 5pm.
For more information, please visit the Oregon Production Investment Fund website. If you’re a Cobalt client and would like to discuss how this program might be a good fit for you, please give us a call or email support@cobaltcpa.com.