IRS Legislation

Qualified Performing Artist Tax Code

The IRS Tax Code provides that a “qualified performing artist” can deduct employee business expenses as an adjustment to income rather than a miscellaneous itemized deduction. However, in order to qualify for this deduction, an artist must have adjusted gross income of less than $16,000—a limit that has not been indexed for inflation since its enactment in 1986.

In 2006, Senators Schumer and Feinstein introduced a bill that would increase to $30,000 the amount that of income that actors and performers could earn and still deduct career-related expenses without itemizing. This bill was never considered by the full Senate Finance Committee last year.

This year SAG is working with Congressional tax staff to enact a legislative solution to this situation that will raise the minimum adjusted gross income level to, at least, $30,000, as well as secure the “indexing” of that amount to ensure it is increased along with inflation. With the Democratic takeover of the Senate, this bill has a dramatically improved chance of moving. It is fully expected that it will be reintroduced with the sponsorship of other key Democrats—and key Republicans—on the Senate Finance Committee, as well as the House Ways & Means Committee.