New York — Actors’ Equity Association, the national union representing more than 51,000 professional actors and stage managers working in live theatre, applauded the Senate introduction of the bipartisan Performing Artist Tax Parity Act (PATPA), introduced by Senators Mark Warner (D-VA) and Bill Hagerty (R-TN). This bill would correct an unintended consequence of the 2017 Tax Cut and Jobs Act which led to tax increases for many performing artists who could no longer deduct the cost of their ordinary and necessary unreimbursed business expenses.
While tax reform did not harm high-income artists, many others in the industry have reported massive tax increases because they lost the ability to deduct their business expenses. “People sit with me and just break into tears because they didn’t know what to do,” Sandra Karas, a tax attorney and secretary-treasurer of Actors’ Equity Association, told the Los Angeles Times, which covered the devastating tax increases that hit performing artists.
Professional actors, stage managers and musicians, for example, typically spend 20 to 30 percent of their income on necessary expenses -- such as to pay for travel to auditions or a talent agent -- to stay in the business and to procure employment.
“I am grateful for the leadership of Senators Warner and Hagerty as they fight for tax fairness for performing artists while the industry is in a historic crisis,” said Kate Shindle, president of Actors’ Equity Association. “The overwhelming majority of Equity stage managers and actors are working-class people who work hard to make ends meet, and unlike other workers, they often have to spend 30 percent of their income on business expenses. Our producers can deduct their business expenses, and we should be able to do so too. The Performing Artist Tax Parity Act will put more money in the pockets of working performers when they need it the most as we work toward recovery in the arts sector.”
The bill would update the bipartisan Qualified Performing Artist (QPA) deduction, which was originally signed into law by President Ronald Reagan. The QPA allows an above-the-line tax deduction for qualified performing artists but has been limited since it was enacted to a total adjusted gross income of the taxpayer to $16,000. PATPA would update the deduction to $100,000 for single filers and $200,000 for married artists filing jointly. The House version of the Performing Artist Tax Parity Act was introduced by Rep. Judy Chu (D-CA) and Rep. Vern Buchanan (R-FL) in July. With the Senate introduction, there is now a bipartisan bill in both chambers of Congress.
“Despite their disproportionate influence and contributions to local communities and economies, the struggle of Americans in the arts has been recognized for years,” wrote Reps. Buchanan and Chu in The Hill when the bill was first introduced. “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.”
To build support for PATPA, Equity has come together with arts and entertainment unions, working in partnership with each other to meet with Congressional offices. Since PATPA was first introduced in June 2019, the unions have held dozens of meetings with congressional staff. Equity and SAG-AFTRA have also submitted testimony to the House Ways and Means Committee regarding the need for tax fairness for actors and stage managers.
ACTORS' EQUITY ASSOCIATION, founded in 1913, is the U.S. labor union that represents more than 51,000 professional actors and stage managers. Equity endeavors to advance the careers of its members by negotiating wages, improving working conditions and providing a wide range of benefits (health and pension included). Member: AFL-CIO, FIA. www.actorsequity.org #EquityWorks
September 29, 2021