Get your FREE Small Business Tax Training Guide Today!

The Show Must Go On!

Qualified Performing Artists Deduction

Congress is Making an Effort to Save Performers Through Tax Breaks

Bi-partisan legislation was recently introduced in the House to amend a provision in the Tax Cuts and Jobs Act of 2017 to help performing artists claim work-related expenses.

The elimination of most deductions through the prior Act led to artists having fewer tax write-offs. This proposed bill would help to correct this issue by updating the Qualified Performing Artists Deduction thresholds so that more lower and middle-income artists can claim it.

Although the bill was brought to light during the previous congressional term, it failed to pass. Now, it’s been re-introduced through The Performing Artist Tax Parity Act, sponsored by Rep. Judy Chu, D-California, and Vern Buchanan, R-Florida. Supporters hope that the bill will successfully pass through Congress this year after witnessing the challenges of the performing arts sector throughout the COVID crisis.

“After an unprecedented pandemic that darkened stages and film sets around the country, performing artists face a long recovery that could mean being some of the last people to return to work,” Chu said in a statement. “That is why we must restore tax deductions that let these workers seek employment without facing steep personal expenses.”

Although support for struggling theaters was made possible through the Small Business Administration’s Shuttered Venue Operators Program grants, the focus needs to transition to ensure that the performers themselves are supported. Actors and musicians may spend up to 30% of their gross income on expenses like headshots, training/classes, agencies, and legal fees. Previously, those expenses were considered write-offs. However, that deduction went away with the 2017 tax law. Combined with COVID, it was a massive hit to the profession.

Since the overwhelming majority of performing artists are lower-income to middle-class, it’s become a struggle for them to make ends meet. Now, this legislation will allow performing arts professionals to keep more of their paychecks, especially when they may be few and far between. The hope is that this new bill will help entertainers recover from the pandemic’s shut-down.

We will keep you informed on the bill’s progression through Congress. If you’re a performer and need some help in determining the best way to protect your hard-earned dollars, reach out to C&B Accounting for professional, knowledgeable guidance.

You Might Also Like

The Show Must Go On!

Congress is Making an Effort to Save Performers Through Tax Breaks Bi-partisan legislation was recently introduced in the House to amend a provision in the

Read More »

Tax-Saving Moves

Changing your state of residency can have a significant effect on your tax bills. Within the U.S., there are nine states that do not require

Read More »

Sign up for our
FREE E-Book!