It’s time to shine a spotlight on the taxes struggling performers pay
When we think of the entertainment industry, most of us think of red carpets and A-list movie stars. But for many in our districts and across the country, entertainment is a livelihood. And often, a difficult one.
Consider the actors and stage managers who work in live-professional theatre across America. Even while working, theatre professionals constantly travel to auditions for new roles to sustain employment. And once they find work, they are on the hook for another set of expenses, with agents’ and managers’ fees topping the list. In any given year, working class professional artists can spend between 20 and 30 percent of their gross income just to stay in the business.
A 2015 analysis from the Bureau of Economic Analysis states that the production of arts and cultural goods added $764 billion to our economy and amounted to a $21 billion trade surplus. And, according to Americans for the Arts, attendees at nonprofit performing arts events spend more than $31 a person per event on additional expenses like parking, babysitting, and meals. This halo effect creates and retains countless jobs in theatre districts, entertainment venues and communities across America.
Despite their disproportionate influence and contributions to local communities and economies, the struggle of Americans in the arts has been recognized for years.
In 1986, Democrats and Republicans worked with President Ronald Reagan to make law the Qualified Performing Artist (QPA) tax deduction, which allows qualified performing artists the ability to deduct expenses incurred over the course of their employment. This “above-the-line” deduction remains a part of the tax code, and for good reason. Members of Congress in both parties understand what a vital part the performing arts play in our economy and have fought to preserve this provision throughout several iterations of tax reform since then.
However, this provision has not been updated since its inception more than three decades ago and is only available to those making less than $16,000 a year. This reality, coupled with the unintended consequences of doubling the standard deduction and limiting some itemized deductions, has left performing artists from coast to coast with tax increases. Most of the stage actors and stage managers who belong to Actors’ Equity Association and members of SAG-AFTRA who work in TV and film are hard-working – often struggling to get by – middle-class taxpayers. They have fallen through the cracks of an imperfect system.
That is why we introduced the Performing Artist Tax Parity Act (PATPA) to better reflect today’s cost of living. Our bill would update and increase the income ceiling to more appropriately reflect today’s cost of living: $100,000 for individuals and $200,000 for married joint filers. This legislation also includes an automatic Consumer Price Index For All Urban Consumers (CPI-U) increase to ensure that the deduction remains relevant as the cost of living increases.
The Screen Actors Guild‐American Federation of Television and Radio Artists estimates that 75 percent of performing artists stand to benefit from the bipartisan legislation.
There’s no question that the entertainment industry is one of our most vital economic engines, creating and retaining jobs, not just in Los Angeles and New York, but also in small- and medium-sized cities across the country such as Sarasota and Pasadena who treasure their theaters and art scenes.
Protecting performing artists and their families from undue financial burden is a bipartisan cause. We will fight for its swift passage to get it to the president’s desk for signing.
Buchanan represents Florida’s 16th District and is co-chair of the bipartisan 29-member Florida congressional delegation. Buchanan is a senior member of the powerful House Ways and Means Committee. Chu represents California’s 27th district. She is a member of the House Ways and Means Committee and the House Small Business Committee. She is also chair of the Congressional Asian Pacific American Caucus.