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Bill Summary · HB 2196

Summary of HB 2196 (Missouri, 2026) – Show MO Act tax credit caps for motion media production

Purpose and intent

  • Reforms the Show MO Act to modify the cap structure and administration of tax credits for motion media production projects (film, series, and related media produced in Missouri).
  • Aims to clarify eligibility, increase flexibility in credit use, and set firm annual credit caps and sunset/renewal rules.

Key provisions and changes

  • Structure and terminology

    • Replaces existing section 135.750 with a new framework describing a “Show MO Act” tax credit for qualified motion media production projects.
    • Defines terms including “above-the-line individual,” “qualified motion media production project,” “qualifying expenses,” “tax credit,” and “taxpayer.”
    • Qualified projects include film/series productions and related media (e.g., videos, commercials, video games, webisodes, VR/AR, postproduction), with a Missouri-filmed designation in credits and specific length/expense thresholds. Excludes certain content (news, talk shows, industrial use, sports events, gala/awards, infomercials, political ads, obscene content).

  • Eligibility thresholds for qualified projects

    • Projects must be under 30 minutes with expected qualifying expenses > $50,000, or over 30 minutes with expenses > $100,000.
    • Certain production types are ineligible (e.g., news, talk shows, industrial/internal use, sports, gala, infomercials, political ads, obscene content).

  • Qualifying expenses

    • In-state spend on goods/services (with purchase price adjustments for goods over $25,000 and netting out fair market value at completion).
    • Wages/withholding in Missouri, with a cap: wages for above-the-line individuals limited to 25% of qualifying expenses.
    • Other standard in-state costs as defined in the statute.

  • Tax credits and base rate

    • Base credit: 20% of qualifying expenses for all tax years beginning 2023 and later.
    • Additional tiered percentages (up to +25% total possible) if criteria are met:
    • +5% if at least 50% of the project is filmed in Missouri.
    • +5% if at least 15% of Missouri filming occurs in rural or blighted areas.
    • +5% if at least three Missouri departments hire a resident for advancement in a specialized craft or learning a new skill.
    • +5% if the script positively markets a Missouri city/region/tourist attraction and the project provides at least five high-resolution promotional photos with cleared rights and accompanying photographer credits.

  • Geographic and workforce incentives

    • An additional +5% if the project is in a rural/blighted Missouri area.
    • An additional +5% if three or more Missouri departments hire a Missouri resident with transferable skills in advancement or learning.
    • A stated requirement to employ a certain number of Missouri apprentices or veterans based on qualifying expenses:
    • < $5M: at least 2 workers
    • $5M–< $10M: at least 3
    • $10M–< $15M: at least 6
    • ≥ $15M: at least 8

  • Administrative and reporting requirements

    • Applications must be submitted to the Missouri Department of Economic Development (DED) with documented expected qualifying expenses and an economic impact statement.
    • Final applications require a CPA-audited report certifying qualifying expenses.
    • Credits are approved by the Missouri Film Commission and the DED.

  • Caps and carryforwards

    • For tax years 2023–2026: film production credits capped at $8 million per year; series production credits capped at $8 million per year; overall combined cap effectively remains within these bounds.
    • Carryforward: unused credits may be carried forward for up to five tax periods, but all credits must be claimed within ten tax periods after certified.
    • Beginning in 2027: total combined cap increases to $16 million per year for film or series production, with the same five-year carryforward and ten-year claim window.

  • Transferability

    • Credits are transferable: taxpayers may sell, assign, or otherwise transfer credits. Acquiring taxpayers can apply credits to offset Missouri tax liabilities (excluding certain withholding taxes) and carry forward unused credits for up to five periods, with the ten-period claim window.

  • Sunset, renewal, and termination provisions

    • Automatic sunset provision: the program sunsets on December 31, 2029 unless reauthorized; if reauthorized, the sunset is 12 years after reauthorization, and the program ends the calendar year after sunset.
    • Additional automatic termination trigger if all other U.S. state/local film incentives have ended; department must notify upon termination.
    • The sunset/termination provisions do not bar redemption of credits earned prior to termination.

  • General rules and department authority

    • The DED may adopt rules, procedures, and guidelines to implement the act.
    • The credit is treated as a business recruitment credit under applicable Missouri law.

Who would be affected

  • Qualified motion media production projects (films, series, and related media) that choose to file for the credit.
  • Missouri-based production companies and vendors providing in-state goods/services.
  • Missouri residents employed in qualified projects (including apprentices and veterans, per eligibility tiers).
  • Financial participants: taxpayers (individuals, partnerships, corporations) eligible for the credit, with transferability enabling sale/assignment of credits.
  • State agencies: Missouri Department of Economic Development and Missouri Film Commission, which administer and approve applications and credits.

Procedural and timeline aspects

  • Effective for tax years beginning January 1, 2023, with caps and rules in place through 2026; the 2027 onward period adjusts the annual cap to $16 million.
  • Applications require documentation and CPA-attested final reports.
  • Credits may be carried forward up to five periods and must be claimed within ten periods after project certification.
  • Automatic sunset scheduled for 2035 if reauthorized (or 2029 if not reauthorized), with additional sunset mechanics tied to broader incentive program terminations.

Note: This summary reflects the bill’s text as introduced and highlights its substantive changes to the Show MO Act, including caps, eligibility, and administrative provisions.

Compiled from official sources — confirm details with the bill’s official record.

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