Microsoft Word - 12. List_Nonqualified_Costs_NYC_MT

New York City Musical and Theatrical Production Tax Credit Program

NON-QUALIFIED COSTS include:

Airfare

Hotels/Apartments/Housing

Per Diems

Entertainment including

 opening night expenses

 alcohol

 tickets to events

 Award shows (items to attend award shows including tickets, wages, hair and makeup, cars)

(promotion of the nomination or win can be 50% qualified as marketing below)

Gifts & Donations including

 doormen tips or other tips not on a receipt

 trips for fans

 donations for any reason including toward promotions

 flowers not used on stage

 Perks (items given to one employee that is not available to a typical union worker—car service, meals,

custom decorating of a dressing room)

Insurance (premiums, deductibles and all costs covered by insurance, except workers’

compensation) (including theatre liability insurance)

Licenses, certification, union membership (including music licenses, art licenses, photo licenses or rights)

Legal Fees

Parking tickets and other violations (speeding, etc.)

Rights/Management

Royalties

EDI costs (including Sexual Harassment or DEI trainings)

Shipping/Transportation(to/from) outside New York State

Advertising/Salaries and expenses 50% Qualified

Marketing/Publicity/ Salaries and expenses 50% Qualified

 Advertising and Marketing are tv, radio, print, online ads purchased or commissions paid for

tickets through advertising (like Audience Rewards, Today Tix, ) - not related media activities nor

production related activities

 Tony Awards show expenses are not qualified (no expenses to perform, attend, bonuses paid for

achieving nominations)

 Summer Stage show or other shows outside the qualified production facility are not qualified

Items incurred out of state (events or supplies for events out of state, transportation, hauling, gas, tolls)

Custom-made items made out of state are 40% qualified/60% nonqualified if there is no breakdown of

the labor and materials.

 If there is a breakdown of the cost of labor and the cost of materials then labor is nonqualified

and materials are qualified.

 Note if the custom-made item is for Advertising or Marketing, only 40% or the 50% qualified

would be qualified—20% or 50% of the actual material costs

Items incurred outside the credit period (storage, wages, monthly fees--if the entire month or quarter is

not in the credit period it should be prorated)

Items incurred outside the Qualified Production Facility

Accrued expenses (only actual expenses are eligible)

Bank Fees, Credit Card Fees, Late Fees and similar

Line items with missing documentation/support either for the entire line item or a portion of the line

item (portion missing support is nonqualified)

Wages in the general ledger in excess of wages reported on the Payroll Summary Report unless the

excess is documented as wages paid outside the payroll system.

Line items not directly and predominantly for the production of the production

 SVOG Recordkeeping

 Accounting for year-end taxes (only accounting for the purposes of paying bills, wages, etc. is qualified;

preparation of the final application is qualified only if it’s done by the production accounting team;

hiring a person or persons just to prepare the final application is not qualified)

 Severance

 Recording of the production for further distribution either through a film or through a service

such as Audible.

 Broadway League dues

 Docusign and Zoom subscriptions

 Buyout agreements for cast and crew not included in the qualified production