NAC360.830. Certificate of eligibility: Application; priorities for approval; reasons for denial.

     1. Transferable tax credits may not be applied to any of the fees and taxes specified in NRS 360.759 unless the Office has issued a certificate of eligibility.

     2. To obtain a certificate of eligibility, a producer must:

     (a) Submit to the Office an application for a certificate of eligibility. The application must be on a form prescribed by the Office and, in addition to the information required by NRS 360.759, contain the following information:

          (1) The name of the qualified production;

          (2) A description of the qualified production;

          (3) The planned rating for the qualified production from a nationally recognized rating association or board, including, without limitation, a rating from the Motion Picture Association of America, or its successor organization, or the Entertainment Software Rating Board, or its successor organization, if applicable;

          (4) A detailed budget for the entire qualified production, including, without limitation, separate in-state and out-of-state subtotals for:

               (I) Wages and salaries, including fringe benefits, for above-the-line personnel;

               (II) Wages and salaries, including fringe benefits, for below-the-line personnel;

               (III) Qualified expenditures and costs, as determined in accordance with NRS 360.7591 and NAC 360.855 and 360.860; and

               (IV) Unless otherwise included in the information provided pursuant to sub-subparagraphs (I), (II) and (III), the maximum compensation payable to any employee or independent contractor paid a wage, salary or fee as compensation for providing labor or services on the production of the qualified production and included as a basis for calculating the amount of transferable tax credit pursuant to NRS 360.7591 to 360.7594, inclusive, and NAC 360.855 and 360.860;

          (5) A job summary for the qualified production, including, without limitation:

               (I) An estimate of the number of jobs that will be created in this State by the qualified production;

               (II) The anticipated term of employment of each such job;

               (III) The anticipated wage to be paid for each such job; and

               (IV) The fringe benefits provided to employees for each such job;

          (6) The capital investment in this State proposed to be made in connection with the qualified production;

          (7) The anticipated location of real property and equipment and other tangible personal property in this State;

          (8) An acknowledgment of audit procedures on a form prescribed by the Office; and

          (9) Any other information required by the application form prescribed by the Office.

     (b) Provide with the application for a certificate of eligibility proof satisfactory to the Office that:

          (1) The qualified production is in the economic interest of this State, as determined pursuant to subsection 5 of NAC 360.835;

          (2) Fifty percent or more of the funding for the qualified production has been placed in an escrow account or trust account for the benefit of the qualified production, or that the producer has a corporate credit rating of “lower medium grade” or higher from a credit rating agency found suitable by the Office; and

          (3) At least 60 percent of the total qualified expenditures and production costs for the production, including preproduction and postproduction, will be incurred in this State.

     (c) Not later than 30 days after the completion of the qualified production, provide the Office with:

          (1) A declaration of residency on a form prescribed by the Office for any above-the-line personnel and below-the-line personnel whom the producer of the qualified production claims to be Nevada residents; and

          (2) An audit of the qualified production, in a form approved by the Office, which includes an itemized report of qualified expenditures and production costs and which:

               (I) Shows that the qualified production incurred qualified expenditures and production costs in this State of $500,000 or more; and

               (II) Is certified by an independent certified public accountant in this State who is approved by the Office.

     3. In considering applications for certificates of eligibility, the Office will give priority to qualified productions that will:

     (a) Be in the economic interest of this State, as determined pursuant to subsection 5 of NAC 360.835.

     (b) Promote tourism in this State.

     4. The Office will deny an application for a certificate of eligibility if:

     (a) The application is received by the Office on or after January 1, 2018.

     (b) The applicant does not commence principal photography or principal development of the qualified production, whichever is applicable, within 90 days after submitting the application to the Office.

     (c) Approval of the application would cause the total amount of transferable tax credits to exceed:

          (1) The amount of transferable tax credits available for approval during the current fiscal year, as determined pursuant to NRS 360.7594.

          (2) The portion of the amount of transferable tax credits available for approval during the current fiscal year that has been apportioned by the Office to the current period of that fiscal year pursuant to NAC 360.850.

     (d) Production of the qualified production is not completed within 1 year after the date of the commencement of principal photography or principal development of the qualified production, whichever is applicable.

     (e) The qualified production is not eligible for transferable tax credits pursuant to this section and NRS 360.759.

     5. As used in this section:

     (a) “Principal development” means the phase of a production that constitutes a qualified production pursuant to NAC 360.825 in which sound, video, images, text or animation is integrated into a digital product.

     (b) “Principal photography” means the phase of a film, television, video or other qualified production in which the production is filmed, videotaped or otherwise recorded using production equipment with actors on set or location.

     (Added to NAC by Office of Economic Dev. by R120-13, eff. 12-23-2013)