# Massachusetts Film Tax Credit

Source: https://storiara.com/incentives/us/massachusetts
Last updated: 2026-09-14
Author: Charles Hirschhorn, Storiara

> Massachusetts offers two film tax credits. Any production spending at least $50,000 in the state earns a 25% payroll credit on Massachusetts payroll, excluding anyone paid $1 million or more. If more than 75% of total production expenses or at least 75% of principal photography days are in Massachusetts, the production also gets 25% of Massachusetts production expenses and a sales tax exemption. Credits can be sold or refunded at 90% of face value, with no annual or project caps.

Massachusetts splits its incentive into two credits with different gates, and most planning decisions come down to whether you clear the second one. The payroll credit is easy to reach. The production credit, worth as much or more on a typical indie, depends on keeping at least three quarters of the show in the state.

## The two credits side by side

| | Payroll credit | Production expense credit |
|---|---|---|
| Rate | 25% of Massachusetts payroll | 25% of Massachusetts production expenses (excluding payroll already credited) |
| Threshold | $50,000 of production costs in Massachusetts in the taxable year | Massachusetts expenses above 75% of total, or at least 75% of principal photography days in Massachusetts |
| Excludes | Salary of any employee paid $1,000,000 or more | Marketing and advertising, credit transfer costs, profit participation |
| Also unlocks | | Sales tax exemption |

Both credits share a ceiling: no individual's salary and compensation, per diems and housing allowances included, counts above $2,000,000. The film office notes there are no annual or project caps and no residency requirement, and the payroll credit covers both above- and below-the-line pay. The 75% thresholds apply to tax years beginning on or after January 1, 2022; before that the figure was 50%.

## Getting the money

The statute lets you choose how to use the credit. You can apply it against Massachusetts personal income or corporate excise tax and carry the rest forward up to 5 years. You can elect a refund, which the film office describes as cashing out at 90% of face value after tax liabilities are satisfied. Or you can sell the credit as a [transferable tax credit](https://storiara.com/glossary/transferable-tax-credit). A sold credit can't then be refunded by the buyer, and you need a certificate of eligibility from the Commissioner of Revenue before any sale. The Commissioner won't issue one if you owe Massachusetts tax on a prior motion picture.

## A $1,000,000 indie in Worcester and Boston

A $1,000,000 feature does prep, shoot, and post in Massachusetts except for a $150,000 color and sound mix in New York.

- Massachusetts payroll (cast and crew working in the state, nobody over $1 million): $450,000
- Other Massachusetts production expenses: $400,000
- Total production expenses: $1,000,000, of which $850,000 (85%) is in Massachusetts

85% clears the 75% test, so both credits apply:

- Payroll credit: 25% x $450,000 = $112,500
- Production credit: 25% x $400,000 = $100,000
- Total: $212,500
- Cashed out at 90%: $191,250

Now move another $150,000 of post to New York. Massachusetts spend drops to $700,000 of $1,000,000, or 70%, which fails the spend test. The production credit still applies because every principal photography day was in Massachusetts, which meets the shoot-day test, but it's now calculated on $250,000 of Massachusetts production expenses: $62,500. With the $112,500 payroll credit, the total falls to $175,000.

## A $5,000,000 feature with a name director

A $5,000,000 feature shoots entirely in Massachusetts. The director's salary is $1,200,000 and the lead actor's is $900,000.

- The director's $1,200,000 salary is left out of the payroll credit because it is at or above $1,000,000
- The actor's $900,000 counts in full for the payroll credit
- Any other Massachusetts payroll counts normally

Whether any of the director's pay can be treated as a production expense is a question to put to DOR and your CPA before you budget it. Nothing above $2,000,000 for any one person counts in either credit.

## What doesn't count

The statute excludes marketing and advertising, costs of transferring credits, and amounts paid as profit participation. News, current events, weather and market reports, talk shows, game shows, sports, awards shows, fundraising productions, long-form content that mainly markets a product, and obscene material aren't eligible. A television series counts as one season of up to 27 episodes.

## Neighboring states

[Rhode Island](https://storiara.com/incentives/us/rhode-island), [Connecticut](https://storiara.com/incentives/us/connecticut), [New York](https://storiara.com/incentives/us/new-york), [Vermont](https://storiara.com/incentives/us/vermont), and [New Hampshire](https://storiara.com/incentives/us/new-hampshire) all border Massachusetts. Further north, [Maine](https://storiara.com/incentives/us/maine) reimburses 10% to 12% of wages up to $50,000 per person, which returns much less on any crew member paid above that limit. Run your numbers in the [incentive calculator](https://storiara.com/tools/incentive-calculator), check [qualified spend](https://storiara.com/glossary/qualified-spend), and read [how film tax credits work](https://storiara.com/blog/how-film-tax-credits-work) for the sale and refund steps. See all states on the [incentives hub](https://storiara.com/incentives). Storiara's [budgeting feature](https://storiara.com/feature/budgeting) is one place to build the budget you'll measure against the 75% line.

## Frequently asked questions

### What is the Massachusetts film tax credit?

A 25% credit on Massachusetts payroll for productions spending at least $50,000 in the state, plus a separate 25% credit on other Massachusetts production expenses if the production meets the 75% spend or shoot-day test.

### What is the 75% rule in Massachusetts?

For tax years beginning on or after January 1, 2022, the production expense credit and sales tax exemption require that Massachusetts production expenses exceed 75% of total production expenses, or that at least 75% of principal photography days take place in Massachusetts. The threshold was 50% before that.

### Can you cash out a Massachusetts film tax credit?

Yes. The Massachusetts Film Office says credits can be cashed out with the Commonwealth at 90% of face value after tax liabilities are satisfied, or sold at market rate. Unused credit carries forward 5 years.

### Does Massachusetts cap film tax credits?

There are no annual or per-project caps. The limits are per person: salaries of $1 million or more are left out of the payroll credit, and no individual's compensation above $2 million counts for either credit.

## Sources

- [Production Tax Incentives (Massachusetts Film Office)](https://mafilm.org/production-tax-incentives/)
- [Massachusetts General Laws, Chapter 62, Section 6(l)](https://malegislature.gov/Laws/GeneralLaws/PartI/TitleIX/Chapter62/Section6)