The Enhanced Illinois Film Credit: A Strategic Overhaul and Competitive Advantage

Brett Hays
3 days ago
6 min read

The New Illinois Film & Television Tax Credits

As a Line Producer, I've had countless conversations focused on state film tax credits—always boiling down to "What's the bottom line and what qualifies?" The passage of Illinois' SB1911 wasn't a minor adjustment; it represented a fundamental, strategic overhaul of the state's film tax credit program.

The new 35% base credit is the headline, but the real hero of this legislation is in the structure. This isn't just a bigger number; it's a multi-faceted statewide incentive system that strategically positions Illinois to be a national powerhouse. For those of us on the ground budgeting productions, this is a very, very big deal.

The Competitive Advantage

Forget the percentages for a minute and look at the bottom line. For a medium-sized project—say, a feature film with a $5.5 million budget shooting downstate—the change is staggering.

Under the old 30% rate: We were looking at around a $1.4 million credit.
Under the new 40% rate (with the 5% downstate bump): That exact same project now qualifies for $1.9 million.

That half-million-dollar difference on a single project isn’t just a line item; it's a massive competitive advantage. It's the difference between greenlighting a project and killing it, or between shooting in Illinois and heading to another state or overseas. If we add the 5% "Green" bump, pushing the credit to 45%, that increases the value to over $2 million. That’s serious money.

Stackable Credits

This is where my Line Producer antennae really start buzzing. The 35% is just the entry point. Illinois has introduced stackable Illinois production spending incentives that allow us to customize our savings based on our production choices:

The Downstate Bump (5% on all IL labor): This is a deliberate, smart move. By incentivizing us to film outside the Chicago metro area, Illinois is building infrastructure and talent pools in places like Central and Southern Illinois. For facilities like Flyover Film Studios, this is an immediate differentiator. If we shoot there, we can hit an effective rate of 40% immediately.
The Green Production Bump (5% on IL spending): The new 5% incentive for eco-conscious productions elevates sustainability beyond mere public relations, making it a valuable financial component. I applaud the Illinois Film Office for integrating this into the credit. While major studios often have dedicated departments mandating trackable sustainability policies, this new incentive will now strongly encourage independent films to adopt similar practices. True film industry sustainability encompasses more than just reusable water bottles; it involves actively reusing and recycling sets, set dressing, props, wardrobe, and countless other items to significantly cut down on the extensive waste generated by a production.
The Relocating Series Bump (5% on IL spending): This is the most attractive incentive for TV. If an existing series decides to move its entire operation to Illinois, we can stack this 5% on top. So imagine an existing show that implements a sustainability plan and moves its operation to Chicago will receive a 5% "green" bonus, bringing the total credit, when combined with the 5% relocation bonus, to 45%. If that show lands at a downstate facility and goes green we could be talking about an effective tax credit of 50%. Globally competitive is an understatement.
The Targeted Employment Bump (15% on targeted labor): An additional 15% credit is available for Illinois labor expenditures that employ residents from areas with high poverty or high unemployment. Since Flyover Film Studios is located in such an area, local residents employed by a production qualify for this extra 15%. This increased credit applies exclusively to specific qualifying labor.

Trusted Creative Partnerships

This new provision acknowledges the value of established creative partnerships in filmmaking. Now, a Director can work with the DP or Editor they have an existing rapport with, ensuring the highest quality product, without impacting the production's tax credit eligibility. Illinois is promoting the making of a better product by removing the previous financial penalty for employing essential, trusted out-of-state crew.

The new credit for non-resident wages is a massive boost to our ability to staff a production with elite talent:

More Crew: The enhanced 30% credit is now available for up to 13 non-resident crew members in key positions, an increase from the previous limit of 9. Notably, this now also covers 2 Executive Producers.
More Cast: The revised film credit significantly improves the tiered system for non-resident actors, allowing for an increase of two actors per budget category compared to the previous credit. Specifically, productions can now claim the credit for up to four non-resident actors for budgets under $20 million, five for budgets between $20 million and $40 million, and six for budgets over $40 million.

For our $5.5 million “medium-sized project” example, expanding the number of non-resident key personnel accounted for over $200,000 of the total credit increase. This removes a major barrier to bringing top-tier talent into the state.

TV & Big Budget Films

The enhanced Illinois film tax credit offers a significant competitive edge, particularly for major film and television productions. This is largely due to the expanded allowance for non-resident crew and actors, substantially increasing the qualified spend. Specifically, productions can now include salaries for up to 13 non-resident crew members (including the Executive Producers, Writers and Directors) and up to 6 non-resident actors. With an individual salary cap of $500,000 PER EPISODE, the potential tax credit generated from these key positions alone is substantial. A TV series, by way of example, could significantly benefit, potentially securing over millions in additional tax credits per episode. This is achieved by factoring in six actors and two Executive Producers, and by fully utilizing all 13 crew positions across a season for multiple writers, directors, and cinematographers. This update ensures Illinois' incentive is now fully competitive with those offered by other leading states and countries.

Stability, Reliability & Growth

For studios and major streamers, stability is everything. Planning a multi-season television show requires a guarantee that the financial ground won't shift under you.

The simple extension of the program's sunset date to January 1, 2039, is perhaps the most critical long-term feature of the bill. It signals to the entire industry—from Hollywood to London—that Illinois is committed for the long haul. That reliability makes Illinois a safe harbor for productions mapping out their slate for the next decade.

A Strategic Offensive

As a Line Producer, I’m constantly comparing states. This new package is not a passive offering; it’s an aggressive, strategically designed offensive. By combining a generous base rate with stackable incentives for regional growth, sustainability, and TV relocation, Illinois is directly challenging the established production hubs in the US and around the world.

This is a new chapter for the American Midwest. The question now isn’t if major productions will come, but when and how many. Illinois has just given us the financial tools to make the answer "right now" and "a lot."

As one jubilant crew member texted me at 2:23 a.m. the night both chambers passed the new tax credit: "Let the good times roll!"

What’s New:

Productions will see an increase in their tax credit for labor when they hire Illinois residents, going to 35% (up from 30%).
Productions will see an increase in their tax credit when hiring Illinois vendors, going to 35% (up from 30%).
Now, up to 13 non-residents other than actors can be included in the film credit calculation, with a 30% tax credit for those salaries on the first $500,000 each. This is up from 9 positions in prior legislation.
Productions hiring non-resident actors continue to receive a 30% tax credit on those salaries up to the first $500,000 per, with the number of eligible actors depending on the project’s budget:
- 4 actors included for projects budgeted at under $20MM
- 5 actors included for projects budgeted between $20MM - $40MM
- 6 actors included for projects budgeted at over $40MM

Note: for the purposes of calculating non-resident compensation for a series, the limit is

applied on a per-episode basis.

For productions filming outside of Cook, DuPage, Kane, Lake, McHenry, and Will Counties, an additional 5% credit is offered on labor expenditures for hiring Illinois residents.
A television series relocating to Illinois will receive an additional 5% credit on its Illinois production spending for its first season filmed in Illinois.
Productions with a certified “green” sustainability plan will receive an additional 5% credit on their Illinois production spending.
Airline tickets now qualify as a production expense in tax credit calculations, when purchased from an airline with their corporate headquarters domiciled in Illinois.
The program was extended to 2039.

Continuing Benefits of Filming in Illinois:

Lower minimum spends for tax credit qualification than competing locations:
- Program running 30 minutes or longer has a minimum spend of $100,000
- Program running less than 30 minutes has a minimum spend of $50,000
15% credit on salaries paid to people who live in economically disadvantaged areas across the state.
Occupancy in the same hotel for 30 consecutive days qualifies productions for exemption from the 11.9% Illinois Hotel Occupancy Tax. After 30 days, all taxes are waived, and the occupant is credited for the first month's tax.

This article was first posted at: https://www.bretthays.com/blog/new-illinois-film-and-television-tax-credits