Alaska2026Passed Legislature

HB113

Tax Exemption for Small Businesses and Film Production Credits

Last scannedSep 23, 2026, 12:32 AM

In one sentence

This bill creates a tax exemption limit for qualified small businesses in Alaska and establishes a new transferable tax credit program to encourage film production within the state.

Adds an income tax exemption for Alaska corporations that meet specific federal definitions of a 'qualified small business' as they existed on January 1, 2012.
Sets a yearly cap of $2.7 million on the total amount of taxes the state forgives under this new small business exemption.
Creates a transferable film production tax credit equal to 25% of qualified spending, with extra credits for hiring Alaska residents or filming in rural areas and during winter months.
Allows producers to sell or give their unused film tax credits to other taxpayers who can use them to lower their own state income taxes.
Requires the Department of Revenue to notify qualifying small businesses at least one year before this exemption expires.

Alaska corporations that qualify as 'qualified small businesses' under federal law, excluding construction, transportation, utility, and fisheries companies.
Film producers who spend at least $100,000 on qualified production costs in Alaska within a consecutive 24-month period.
Taxpayers who purchase or receive transferred film tax credits to offset their state income taxes.

The total tax exemption for small businesses cannot exceed $2.7 million per year, so some qualifying companies may not get it if demand is high.
Film producers must wait until after filming ends and submit a report verified by an accountant before receiving the final credit amount.
The bill does not state when these new rules will officially begin or end.

Plain language

Qualified small business: A corporation that meets federal rules for this status as of January 1, 2012, but is not in the construction, transportation, utility, or fisheries industries.
Transferable tax credit: A reduction in taxes owed by a producer that can be sold to another person who then uses it to pay less state income tax within three years of being provided.
Qualified expenditures: Spending on film production costs that meet the rules set out in this bill and are verified by an independent certified public accountant approved by the program.

Official record

Source checked

Read the official summary

TAX EXEMPTION: SMALL BUSINESS An Act relating to a tax exemption for qualified small businesses; and providing for an effective date.

Official activity