Maryland Film Tax Credit

How the Maryland Film Production Activity Tax Credit Works

Maryland's Film Production Activity Tax Credit is administered by the Maryland Department of Commerce and provides a credit of 28% of total qualified direct costs for most productions, or 30% for television series. The program has a per-project cap of $10 million and an annual funding cap of $12 million for fiscal year 2026 (July 1, 2025 through June 30, 2026).

Applications must be submitted to the Department of Commerce before principal photography begins in Maryland. The department reviews applications and allocates credits on a competitive basis within the annual cap. Productions should not assume approval or begin incurring qualifying costs before receiving written confirmation from the department.

Maryland also administers a separate Maryland Small Film Project credit for lower-budget independent productions, with a minimum spend of just $25,000 and a per-project cap of $125,000 at the same 28% rate.

Credit Rate Structure

The standard credit rate is 28% of qualified direct costs for feature films, commercials, music videos, documentaries, and other one-time productions. Television series earn a 30% credit on qualified costs, reflecting Maryland's interest in attracting recurring episodic production that creates sustained economic activity and crew employment over multiple seasons.

The credit is non-refundable but transferable. Productions can sell or transfer unused credit amounts to Maryland taxpayers. The transferability makes the credit accessible to out-of-state production companies without Maryland tax liability, though they will need to find a Maryland taxpayer buyer, typically through a film incentive brokerage.

Eligible Production Types

Maryland's program covers feature films, television series, documentaries, commercials, and music videos. A key qualification is that 50% of total principal photography days must be filmed in Maryland. This in-state photography requirement ensures the state is attracting genuine production activity, not just spending that happens to pass through Maryland vendors.

Maryland Small Film Projects have relaxed requirements and a lower minimum spend, making the program accessible for short films, micro-budget features, and independent documentary productions that cannot meet the standard $250,000 minimum.

What Qualifies as a Maryland Expenditure

Qualifying direct costs include wages and compensation paid for services performed in Maryland, payments to Maryland vendors for production goods and services, equipment rentals, location fees, set construction, transportation, and other direct in-state production costs. Salaries, wages, or compensation exceeding $500,000 per individual do not qualify for the credit calculation. This cap on high-end compensation is a meaningful distinction compared to states like Louisiana that have removed per-person wage limits.

Development costs, marketing expenses, story and script fees, and costs incurred outside Maryland are excluded from the qualified cost calculation.

Minimum Spend Requirements

The standard program requires a minimum of $250,000 in total authorized direct costs incurred in Maryland. The Maryland Small Film Project has a minimum of $25,000, providing a pathway for smaller independent productions to access state support. Both minimums must be met through in-state spending that qualifies under the program's guidelines.

How to Apply

The application is submitted to the Maryland Department of Commerce before production begins. The application includes a detailed production budget, schedule, list of key personnel, and an estimate of Maryland direct costs. The department reviews applications and issues a certification letter for approved productions.

After production wraps, a final cost report is submitted with supporting documentation for all qualifying Maryland expenditures. The department may require a CPA audit for productions claiming significant credits. The final credit certificate is issued based on verified qualifying costs, up to the per-project cap.

Why Productions Choose Maryland

Maryland offers one of the most production-friendly environments in the Mid-Atlantic region. The Baltimore-Washington corridor provides urban settings with distinct character from post-industrial Baltimore neighborhoods to the federal architecture and diverse neighborhoods of the Washington DC suburbs. The Eastern Shore, Western Maryland mountains, and Chesapeake Bay provide natural and rural settings within a short drive of major population centers.

Maryland has a strong crew base developed through years of hosting major productions, and the state's proximity to New York and DC makes it easy to bring in additional talent when needed. The 30% credit for television series, combined with Maryland's established production infrastructure, makes it a genuine competitor for episodic productions seeking alternatives to New York.

For independent producers, the Maryland Small Film Project program provides a low-barrier entry point to state incentives, requiring only $25,000 in qualifying spend. This tiered approach reflects the Department of Commerce's interest in supporting the full range of production activity, from major studio features to emerging independent filmmakers.