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Tuesday, November 29, 2005

Congress to Slash Taxes for Songwriters

Interesting article in today's Wall Street Journal:  Music to Songwriters' Ears: Lower Taxes; Country Artists' Group Presses Lawmakers to Slash the Levy on Lyricists, by Brody Mullins:

Country music is cool these days -- and now Congress may make it more profitable for the people behind the lyrics. A bipartisan group of lawmakers, prodded by members of the country-music industry, added a provision to pending tax legislation that would lower taxes for writers of all kinds of songs. The lawmakers propose to change a section of U.S. tax law -- written before singer Garth Brooks was born -- that would tax songwriters' handiwork as capital gains rather than ordinary income as under current law. ...

At issue for the songwriters is a 1950s-vintage tax provision that requires makers of creative works -- such as painters, novelists and songwriters -- to pay regular income taxes on sales of their work. Since songwriters tend to be self-employed, they wind up paying up to 35% in income taxes on the sales and more in self-employment taxes, rather than the lower 15% capital-gains tax rate paid by those who sell capital assets such as stocks.

http://taxprof.typepad.com/taxprof_blog/2005/11/congress_to_sla.html

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Comments

So if I sing my to my classes is my salary suddenly capital gains? Are my self-designed course materials qualified writings? Are my powerpoint slides, despite all my joking to the contrary, works of art?

"Whistle while you work" may become the IRC theme song.

Posted by: Jim Maule | Nov 29, 2005 2:00:11 PM