California Adds TV Animation To Tax Credit Program For The First Time

California is opening its tax credit program to television animation for the first time.

In the latest round of awards from Governor Gavin Newsom’s expanded Film & Television Tax Credit Program, animated series are now officially eligible alongside live-action projects. It’s a relatively small addition within a much larger funding push, but one that carries real weight for the animation side of the industry.

According to the Governor:

California’s creative economy isn’t just part of who we are — it helps power this state forward. From the folks on the soundstage to the people designing the sets, these are jobs that anchor communities. I’m pleased to expand this award to animated and competition shows, helping advance the strongest entertainment economy in the nation and bringing even more good-paying jobs to California.

Two animated TV projects made the cut in this round: Adult Swim’s President Curtis (Adult Swim), a Rick and Morty spinoff, and 20th Television Animation’s Stewie, a Family Guy spinoff. They’re grouped into a newly added category that also includes competition shows. Together, those projects account for about $46 million in qualified in-state spending and are expected to generate more than 700 jobs.

For a local industry that has long operated without direct access to tax incentives often available elsewhere, the change is a welcome one. TV animation production is regularly split across multiple regions, with studios typically hosting lead creative teams in Los Angeles against production pipelines elsewhere in the U.S. and, increasingly, abroad. Bringing animation into the tax credit system should give studios a clearer financial reason to keep more of that work in-state. At least he ones picked for the program.

Dan Harmon, creator, writer, and producer of President Curtis, as well as numerous other popular animation and live-action series, said of the state’s decision:

We are thrilled to be recognized by the California Film Commission’s Tax Credit Program as its first animated series. Our crew is the best in the business, and the Tax Credit Program will allow us to prevent outsourcing and hire more Los Angeles-based talent.

This is, at present, only an initial step, and one that will hopefully lead to a more diverse group of projects receiving backing, not just big-name studio fare from already monied companies. Time will tell if and how more independent productions benefit.

The number of animation projects included is limited for now, and the funding allocated to the category remains modest compared to the overall program, which now totals $750 million annually. How animation fits into future rounds will be the real indicator of how significant this shift becomes to the industry.

Even so, the inclusion itself marks a step in the right direction for the state’s struggling industry. Animation is now part of the same incentive framework as live-action television, at least in principle.