Section 41-7A-42 Definitions. (Repealed by Act 2023-546, § 9, Effective December 31, 2028, Unless Extended by Act of Legislature)

For purposes of this article, the following terms have the following meanings: (1) COMPANY. A corporation, partnership, limited liability company, or any other business entity. (2) DEPARTMENT. The Alabama Department of Revenue. (3) ENTERTAINMENT INDUSTRY. Those persons or entities engaged in the production of entertainment content as defined under paragraph (8)a. (4) EXPENDED IN ALABAMA. In the case of tangible property, property that is acquired or leased from a source within the State of Alabama; in the case of services, services performed for a qualified production project in the State of Alabama. (5) OFFICE. The Alabama Entertainment Office. (6) PAYROLL. All salary, wages, and other compensation, including related benefits, including specifically, but not limited to, compensation and benefits provided to resident and nonresident producers, directors, writers, actors, and other personnel involved in qualified production projects in the State of Alabama. For the purpose of the rebate for qualified production companies computed under Section 41-7A-43, other compensation includes payments to a loan-out company by a qualified production company only if: a. The qualified production company withheld and remitted Alabama withholding tax at the highest rate levied in Section 40-18-71 on all payments to the loan-out company for services performed in this state. The amount withheld is considered to have been withheld by the loan-out company on wages paid to its employees for services performed in this state; or b. The qualified production company withheld and remitted Alabama income tax at the highest rate levied in Section 40-18-5, or Section 40-18-31 in the case of a C corporation, on all payments to the loan-out company for services performed in this state. The amount withheld on payments to the loan-out company and remitted to the State of Alabama shall satisfy the loan-out company’s requirement to make estimated income tax payments under Section 40-18-80.1 in the case of C corporation or Electing Pass-Through Entity, and Section 40-18-80 in the case of an individual, if the loan-out company is a Single Member LLC or independent contractor, and the requirement to pay composite tax on nonresident members of a pass-through entity under Section 40-18-24.2. (7) PRODUCTION EXPENDITURES. a. The term includes preproduction, production, and postproduction expenditures incurred in the State of Alabama which are directly used in a state-certified production, including, but not limited to, the following: Set construction and operation, wardrobe, makeup, set accessories, and related services; costs associated with photography and sound synchronization, lighting, and related services and materials; editing and related services; rental of facilities and equipment; leasing of vehicles; costs of food and lodging; costs of catering; digital or tape editing, film processing, transfer of film to tape or digital format; transfer direct to DVD, cable, or satellite for distribution; sound mixing, special and visual effects including duplication, film processing digital, DVD, music composition, and satellite distribution; total aggregate payroll; music; airfare; insurance costs of bonding; or other similar production expenditures as determined by rule or regulation. b. The term includes financial contributions or educational or workforce development in partnership with related educational institutions, or local industry organizations, or both, contributed toward the furtherance of the local entertainment media industries. c. The term does not include postproduction expenditures for marketing or any amounts that are paid to persons or entities as a result of their participation in profits from the exploitation of a motion picture production. d. This term does not include other compensation paid to a loan-out company by a qualified production company if the qualified production company does not withhold and remit either the Alabama withholding tax at the highest rate levied in 40-18-71 or Alabama income tax at the highest rate levied in Section 40-18-5, or Section 40-18-31 in the case of a C corporation. A loan-out company shall file the applicable Alabama withholding tax and/or income tax returns for the taxable year in which such services were performed. A loan-out company’s failure to file an Alabama income tax return shall not disqualify payments made to that loan-out company for the rebate computed under Section 41-7A-43. (8) QUALIFIED PRODUCTION. a. The term means entertainment content created in whole or in part within the state, including motion pictures; soundtracks for motion pictures; documentaries; long-form, specials, miniseries, series, sound recordings, music albums, videos and music videos, and interstitials television programming; interactive television; interactive games; video games; commercials; infomercials; any format of digital media, including an interactive website that is intended for national or international distribution or exhibition to the general public; and any trailer, pilot, video teaser, or demo created primarily to stimulate the sale, marketing, promotion, or exploitation of future investment in either a product or a qualified production via any means and media in any digital media format, film, or videotape, provided such program meets all the underlying criteria of a qualified production. b. The term does not include any ongoing television program created primarily as news, weather, or financial market reports, a production featuring current events, sporting events, an awards show or other gala event, a production whose sole purpose is fundraising, a long-form production that primarily markets a product or service, a production used for corporate training or in-house corporate advertising or other similar productions; nor does the term include any production for which records are required to be maintained under 18 U.S.C. § 2257 with respect to sexually explicit content; nor does the term mean or include any form of gambling, gaming, wagering, or pari-mutuel wagering activity or enterprise. (9) QUALIFIED PRODUCTION COMPANY. a. The term means a company engaged in the business of producing a qualified production, as that term is defined. b. The term does not mean or include any company owned, affiliated, or controlled, in whole or in part, by any company or person that is in default on a loan. (10) RESIDENT OF ALABAMA. A natural person and, for the purpose of determining eligibility for the incentives provided by this article, any person domiciled in the State of Alabama and any other person who maintains a permanent place of abode within the state and spends in the aggregate more than six months of each year within the State of Alabama. (11) STATE-CERTIFIED PRODUCTION. A qualified production approved by the office, produced by a qualified production company.