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WASHINGTON, D.C. — On April 19, Reps. Judy Chu (CA-28) and Vern Buchanan (FL-16) introduced the Performing Arts Tax Parity Act (PATPA) of 2023, legislation that would update the existing Qualified Performing Artist tax deduction to once again allow working class actors and performers to deduct the costs of work-related expenses.

The Tax Cuts and Jobs Act of 2017 eliminated the ability to claim miscellaneous itemized deductions, which previously allowed artists to deduct their work expenses. The elimination of these deductions has caused many artists to pay thousands more in taxes. The Performing Artist Tax Parity Act corrects this problem by updating the thresholds of the Qualified Performing Artists Deduction to allow more lower and middle-income artists to utilize it. Today, it is only available to those making less than $16,000 a year. To better reflect the present-day cost of living, the bill would increase the income ceiling to $100,000 for individuals and $200,000 for married joint filers and tie it to the automatic Consumer Price Index for all Urban Consumers (CPI-U) to ensure its future use.

"In 2017, working-class performers and artists lost their ability to deduct common business expenses from their taxes. In an already demanding industry, paying for professional essentials like transportation, a talent agent, or equipment should not prevent entertainers from meeting their basic needs," said Rep. Chu, who also serves as Co-Chair of the bipartisan Creative Rights Caucus. "I am proud to once again join in a bipartisan effort with Congressman Buchanan to ensure that entertainment professionals get the tax relief they deserve through PATPA and can continue inspiring Americans across the country."

The arts and culture sector of the economy in California was a $261 billion industry in 2021, representing 7.7 percent of the state's GDP. The industry supports 742,432 jobs, or 4.1 percent of California's workforce. Working performers in the entertainment and arts sectors are employees, not contractors, who accrue significant but necessary expenses to sustain employment. Such expenses include ongoing training, travel for auditions, promotional material and talent agent commissions.

"The overwhelming majority of performing artists are lower-income and middle-class Americans struggling to make ends meet," Rep. Buchanan said. "Congresswoman Chu and I are fighting to update this nearly 40-year-old law to deliver needed tax relief for performing artists in Southwest Florida and across the country. I know firsthand that our performing arts institutions and local talented performers are a tremendous asset in our community. This bipartisan legislation would help those creative workers unable to deduct expenses that relate directly to their employment and livelihoods."

"I thank Representatives Buchanan and Chu for the Performing Artist Tax Parity Act," said Fran Drescher, president of SAG-AFTRA. "This bi-partisan bill allows journeymen actors their legitimate business expenses and ensures their artistic contributions continue to enrich all of our lives each and every day."

"Thousands of Equity members just filed their taxes, and again owed hundreds - sometimes thousands - of dollars more than before," said Kate Shindle, president of Actors' Equity Association. "The overwhelming majority of arts professionals are middle-class workers who just can't afford that. Fortunately, the tax code already recognizes the up-front business expenses of working in our industry; the problem is simply that the relevant income thresholds haven't been revised since the Reagan Administration. We are grateful for the leadership of Reps. Buchanan and Chu, and thank them for reintroducing this critical bipartisan legislation while we're all still working toward a full recovery of the live performing arts."

Under current law, a Qualified Performing Artist is defined as having 1) performed services in the performing arts for, at minimum, two different employers during a taxable year, 2) an amount of allowable deductions exceeding 10 percent of their gross income related to those services, and 3) an adjusted gross income of no more than $16,000.

Click here to read the legislation's full text.

Issues: Small Business, Jobs and the Economy Worker Rights and Labor 

Original source can be found here.