This bill modernizes the tax deduction for performing artists by eliminating the outdated 16,000 dollar income cap and increasing the minimum employer payment threshold to 500 dollars (inflation-adjusted). It creates a new phase-out for higher earners: deductions reduce starting at 100,000 dollars income (200,000 joint) and phase out completely at 120,000 (240,000 joint). Manager and agent commissions become deductible business expenses.
Latest Action
Referred to the House Committee on Ways and Means.
AI Summary
Plain-English explanation of this bill
This bill modernizes the tax deduction for performing artists by eliminating the outdated 16,000 dollar income cap and increasing the minimum employer payment threshold to 500 dollars (inflation-adjusted). It creates a new phase-out for higher earners: deductions reduce starting at 100,000 dollars income (200,000 joint) and phase out completely at 120,000 (240,000 joint). Manager and agent commissions become deductible business expenses.
Last updated: 1/4/2026
Official Summary
Congressional Research Service summary
<p><strong>Performing Artist Tax Parity Act of 2025</strong></p><p>This bill increases the income limit and makes other modifications to the above-the-line tax deduction for business expenses of qualified performing artists. (Above-the-line deductions are subtracted from gross income to calculate adjusted gross income.)</p><p>Under current law, a <em>qualified performing artist</em> (who may deduct certain business expenses from gross income) is defined as an individual who (1) performs services in the performing arts as an employee for at least two employers during the tax year and receives at least $200 from each employer (minimum payment), (2) has business deductions attributable to such services exceeding 10% of the gross income received from such services, and (3) has adjusted gross income of $16,000 or less.</p><p>The bill modifies the definition of a <em>qualified performing artist</em> (for purposes of the business expense deduction) to eliminate the $16,000 adjusted gross income limitation and increase the minimum payment amount to $500 (adjusted for inflation beginning in 2026).</p><p>However, under the bill, the tax deduction for business expenses of qualified performing artists phases out for individuals with gross income exceeding $100,000 (or $200,000 for joint filers) such that the tax deduction completely phases out for individuals with gross income exceeding $120,000 (or $240,000 for joint filers). (The phase-out threshold is adjusted for inflation beginning in 2026.)</p><p>Finally, the bill provides that commissions paid to a manager or agent by a qualified performing artist are deductible business expenses.</p>
Key Points
Main provisions of the bill
Eliminates the outdated 16,000 dollar adjusted gross income limitation
Increases minimum employer payment threshold to 500 dollars with inflation adjustment
Creates phase-out between 100,000 and 120,000 income (200,000-240,000 joint)
Makes manager and agent commissions deductible
Maintains requirement of services for at least two employers annually
How This Impacts Americans
Potential effects on citizens and communities
This update reflects the reality that professional performing artists rarely earn below 16,000 dollars annually yet face substantial work-related expenses. The modernized income thresholds allow middle-income performers to deduct legitimate business costs while phasing out benefits for high earners. Treating agent commissions as deductible acknowledges they are standard industry expenses, providing tax parity with other self-employed professionals.
Policy Areas
Primary Policy Area
Taxation
Scope & Jurisdiction
Jurisdiction Level
federal
Congressional Session
119th Congress
Citation Reference
721, 119th Congress (2025). "Performing Artist Tax Parity Act of 2025". Source: Voter's Right Platform. https://votersright.org/bills/118-hr-721