‘Simpsons Movie 2,’ ‘Phineas and Ferb’ Project Among First Animated Features To Land California Tax Credits

California is continuing its push to bring animation production back to the state, with a new round of tax credits that now includes animated features alongside live-action projects.

Governor Gavin Newsom announced that 38 film and television projects have been approved under the state’s expanded Film & Television Tax Credit Program. The selected productions span studio films, independents, and several animated features, and are projected to generate roughly $796 million in economic activity while supporting thousands of jobs.

Among the animation titles receiving credits are The Simpsons Movie 2, a new Phineas and Ferb project, and a feature from DreamWorks Animation. The Simpsons Movie 2 is set to receive $21.9 million in tax credits, while the Phineas and Ferb feature has been allocated about $3.5 million. Credit amounts for the DreamWorks project haven’t been shared yet, at least not that we can find.

This marks a long-overdue first time that animated features have been eligible for California’s incentive program, a shift aimed at retaining production that has increasingly moved to other regions.

The move follows the program’s recent expansion into television animation. Earlier this year, series such as Stewie and President Curtis became the first animated TV productions to qualify for California tax credits, providing an early test case for how animation fits into the state’s broader incentive system.

These updates come amid broader efforts to modernize California’s approach to animation. A bill introduced last year proposed expanding the state’s tax credit program to as much as 35% while explicitly including animated features, series, and shorts among eligible productions.

While animation still accounts for a small share of the overall tax credit program, this is certainly another step in the right direction. As with the TV credits, the first batch has been earmarked only for big-studio fare, but the new incentives system was meant to include productions of all sizes, so hopefully that applies to animated recipients, too.

If the endgame is economic stability, animation should probably start to represent a larger share of the backed productions. While live-action productions tend to take months, animated features typically take years, providing stable work and benefits to hundreds of staff.

According to today’s report, applications to the updated program have increased significantly, and the state has already approved well over a hundred projects under the revised system. The inclusion of animated features adds another step in California’s effort to retain production work that has steadily moved outside the state.