Entertainment Industry Coalition Urges Congress To Approve Tax Break For Performing Artists & Creative Professionals

A coalition of entertainment industry unions and associations is urging Congress to include the Performing Artist Tax Parity Act in any omnibus legislation that may come before the House and Senate for fiscal year 2022.

In a letter sent Thursday to leaders of the House and Senate, supporters of the legislation say it would “restore tax fairness for middle-class creative professionals” by updating the current Qualified Performing Artist (QPA) deduction and “meaningfully impact the lives of creative professionals and their families.”

By way of example, they say that “a Pennsylvania sound engineer would realize a tax savings of over $4,500 under PATPA. A Nevada actor would pay $1,500 less in taxes. A New York musician would save $3,000. This is money that these middle-class professionals can put toward the next month’s rent, putting food on the table, and contributing to their local economies.”

Backers of the legislation include SAG-AFTRA, IATSE, Actors’ Equity, the WGA East, the Motion Picture Association, the Recording Industry Association of America, the Broadway League, Carnegie Hall and the Department for Professional Employees, AFL-CIO. See the full list of signers below.

Introduced in the House by Judy Chu (D-CA) and Vern Buchanan (R-FL) and in the Senate by Mark Warner (D-VA) and Bill Hagerty (R-TN), the letter says that “this bipartisan legislation would update the Qualified Performing Artist deduction to correct an unintended consequence of tax reform that has caused a drastic tax increase for middle class creative professionals.”

“Actors, stage managers, dancers, musicians, cinematographers, and many other creative professionals spend 20% to 30% of their income on necessary expenses to secure and maintain employment, including instruments, travel to auditions, managers and talent agents, and camera equipment,” they said in their letter. “Prior to 2017, these creators could claim miscellaneous itemized deductions for these business expenses. Without the ability to deduct these expenses, middle class creative professionals have experienced significant tax increases and struggled to make ends meet even before the Covid-19 pandemic.

“PATPA would restore tax fairness for middle class creative professionals, whether they are union members or not, by updating the eligibility threshold for the QPA deduction. It also would help these individuals seek employment at a time when our industries cannot afford a worker shortage.”

QPA allows certain performing artists the option to take an “above the line” deduction for unreimbursed expenses. Currently the adjusted gross income threshold for the QPA deduction is $16,000, a level unchanged since QPA’s inception in 1986.

Supporters say that PATPA would “modernize and update” these outdated levels to $100,000 for single taxpayers and $200,000 for joint filers, and also add a built-in phase-out to help transition the taxpayer out of the deduction.

“Including PATPA in a FY 2022 omnibus bill,” they wrote, “will also go a long way toward helping professionals in the creative sector who were hard-hit by the Covid-19 pandemic and continue to be impacted by the current variant.”

The letter was signed by:

American Composers Forum
Actors’ Equity Association
American Federation of Musicians
American Guild of Musical Artists
American Guild of Variety Artists
Broadway League
Carnegie Hall
Dance USA
Department for Professional Employees, AFL-CIO
Guild of Italian American Actors
Artists and Allied Crafts
League of American Orchestras
Motion Picture Association
Office and Professional Employees International Union
Opera America
Oregon Shakespeare Festival
Performing Arts Alliance
Recording Industry Association of America
Stage Directors and Choreographers Society
Theatre Communications Group
Theatre Producers League of Southern California
Writers Guild of America, East

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