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New York State’s First Ever $25 Million Digital Game Development Tax Credit Program

December 16th, 2022

This article was written by Victoria Davis, Senior Accountant.

On November 4th, 2022, Governor Kathy Hochul announced initial applications are now being accepted for the first ever New York State (NYS) Digital Game Development Tax Credit Program to support game development. This program is set to begin on or after January 1, 2023, and end before January 1, 2028.

The new tax credit program is intended to attract and grow the digital game industry across the state by reducing some productions costs associated with digital game production. The state has already invested over $20 million in Digital Game Development at New York University (NYU), Rensselaer Polytechnic Institute (RPI), and The Rochester Institute of Technology (RIT) to help build industry innovation and collaboration. In turn, these centers have created more than 120 jobs and have led to the development of more than 110 games.

The $25 million tax credit will award up to $5 million per year for five years to qualified digital game development studios. Qualified companies are defined as those who develop video simulation, animation, text, audio, graphics, or similar gaming related property embodied in digital format.

Applicants are required to submit their initial applications (on the Empire State Development website) to NYS prior to beginning the project, but no more than 90 days before the start of production. Once the application is approved and the project is complete, applicants can receive up to 25 percent of qualified production costs in New York City (NYC) and up to 35 percent outside of the NYC metropolitan area. To qualify, the taxpayer must be engaged in a qualified gaming media production and must have a minimum of $100,000 total production costs. Additionally, a minimum of 75 percent of the total costs must be incurred and paid by the applicant for services rendered in NYS. There is a maximum of $4,000,000 in qualified costs per project when calculating the credit. Wages paid to an individual directly employed by the qualified employer are limited to $100,000 each when calculating the credit.

Eligible expenditures include:

  • Any costs for wages or salaries paid to individuals, other than actors or writers, directly employed in the creation of the production for the digital gaming media.
  • Payment for services performed in the development, design, production, editing, and composing of the digital gaming media.

It is also important to note that costs may not include expenses incurred for the distribution, marketing, promotion, or advertising of the digital media content, as well as salaries of executive staff for companies larger than 10 employees.

Governor Hochul also announced that NYS will be the first state in the nation to lead a statewide pavilion at the 2023 Game Developers Conference – an industry event held in San Francisco from March 20 to March 24.

Are you interested in joining NYS’s Pavilion for the 2023 Game Developers Conference? Learn more here or contact And if you have any questions, we’re here to help. Please do not hesitate to reach out to our trusted experts today.

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