Two House lawmakers on Wednesday reintroduced bipartisan legislation aimed at changing a provision in the Tax Cuts and Jobs Act that makes it difficult for performers to deduct professional expenses.
The Performing Artist Tax Parity Act, sponsored by Representative Judy Chu, D-Calif., And Vern Buchanan, R-Florida, would update the tax deduction for qualified performers to help performers deduct work-related expenses. The Tax Cuts and Jobs Act of 2017 largely eliminated the possibility of claiming various itemized deductions that allowed performers to deduct their labor expenses. The elimination of deductions has caused many artists to pay thousands of additional taxes. The bill would correct this problem by updating the thresholds for the skilled performers deduction to allow more low- and middle-income performers to claim it.
The bill was introduced during the previous legislature, but did not move forward. Supporters are hoping the legislation will be passed this year after many performing artists have seen much of their income dry up since last year due to the closure of theaters, clubs, arenas and other venues during the pandemic of COVID-19.
“After an unprecedented pandemic that has darkened movie stages and sets across the country, performing artists face a long recovery that could mean being among the last people to return to work,” Chu said in a statement. communicated. “That is why we must restore tax deductions that allow these workers to seek employment without facing high personal expenses.”
She noted that Congress has already taken action to support theaters through grants from the Small Business Administration’s Shuttered Venue Operators program. “Now we have to act to make sure that the actors, musicians and artists who make the performances so special are also supported,” Chu added. “Expenses such as head shots, training / courses, management, agency and legal fees, and much more require professional artists to spend up to 30% of their gross income on stay in business every year. For years, these expenses could be deducted from their taxes, but that deduction was lost in the 2017 tax law, forcing artists to spend thousands more. It is an untenable blow to working families that is hurting our economy and our communities. “
The problem actually dates back to even before the adoption of the Tax Cuts and Jobs Act and aims to level the playing field with other types of businesses that are still allowed to write off their expenses.
“The overwhelming majority of performing artists are low-income and middle-class Americans who struggle to make ends meet while simultaneously pursuing their passions,” Buchanan said in a statement. “It’s high time to update this 30-year-old law to provide needed tax breaks for artists in Southwest Florida and across the country.”
The legislation has been endorsed by several unions representing performing artists.
“We have been fighting for 35 years for this legislation because it will allow artists and media professionals to keep more of their hard-earned money, especially now when they need it most,” said SAG President. -AFTRA, Gabrielle Carteris, in a statement.
“I am grateful for the leadership of Representatives Chu and Buchanan as they fight for tax fairness for performing artists as the industry is in a historic crisis,” said Kate Shindle, President of The Actors ‘Equity Association, in a statement. “The overwhelming majority of Equity managers and actors are working class people who work hard to make ends meet, and unlike other workers, they often have to spend 30% of their income on business expenses. Our producers can deduct their business expenses, and so should we. The Performing Artists Tax Parity Act will put more money in the pockets of working artists when they need it most as we work to recover the arts sector.
“The recent loss of necessary professional expenses that were regularly deducted by musicians and performers under the Qualified Performers (QPA) provision of the Federal Tax Code, which were eliminated with the passage of the Law on tax cuts and employment of 2017, resulted in increased taxes for working musicians, who are now struggling to recover from an irreparable loss of their income due to the COVID 19 pandemic, ”said Ray Hair , President of the American Federation of Musicians of the United States and Canada. “It will help professional musicians and other artists to recover from the ravages of the pandemic and become whole again. “
“This is a great example of Congress putting aside partisanship to right a wrong that affects thousands of middle-class entertainment workers and creative professionals,” said Matthew D. Loeb, president of the International Alliance of Theatrical Stage Employees International, in a report. “This unnecessary tax hike hurt our members long before the COVID-19 pandemic ended our jobs and erased our salaries. Now, with a full return to work in sight, Congress should pass this bill, restore tax fairness, and ensure our workers come back stronger than before. “
Further approvals came from AFL-CIO officials, Americans for the Arts and Theater Communications Group.