Sponsors (27)
The bill provides targeted above‑the‑line tax relief for performing artists and preserves those rules against inflation, at the cost of some federal revenue and with limits that phase out benefits for higher‑earning artists and potentially exclude workers tied to very small employers.
Performing artists (e.g., actors, musicians, dancers) can deduct work-related expenses above the line — including commissions paid to managers/agents — which lowers their adjusted gross income and reduces taxable income for those who qualify.
Phaseout and nominal‑employer thresholds are indexed for cost‑of‑living adjustments after 2025, which helps preserve the real value of the deduction rules over time and prevents erosion from inflation.
Expanding above‑the‑line deductions reduces taxable income broadly and is likely to modestly reduce federal revenue, increasing budgetary costs or pressure to offset the loss elsewhere.
Higher‑income performers will lose the deduction quickly because it phases out rapidly (10 percentage points per $2,000 above $100,000), which may eliminate benefits for many middle‑ or higher‑earning artists.
Raising the nominal‑employer threshold to $500 could disqualify some workers from counting small employers for eligibility tests, reducing who can claim the deduction.
Based on analysis of 2 sections of legislative text.
Makes performing-artist expenses above-the-line, raises/indexes employer threshold, and phases down the deduction for higher incomes.
Treats performing-artist work expenses as above-the-line deductions and changes how much high earners may deduct. It raises and indexes the nominal-employer threshold, explicitly includes manager/agent commissions, and phases down the deduction for taxpayers with adjusted gross income above specified thresholds, with effect for tax years starting after Dec 31, 2024. The bill generally expands access to the above-the-line performing-artist deduction for eligible performers while introducing an income-based phasedown and automatic cost-of-living indexing for thresholds after 2025.
Official title: To amend the Internal Revenue Code of 1986 to increase the adjusted gross income limitation for above-the-line deduction of expenses of performing artist employees, and for other purposes.
Introduced January 24, 2025 by Vernon G. Buchanan · Last progress January 24, 2025