Escajeda: Songwriters, Poets, And Tax Policy

Hilary G. Escajeda (Mississippi College School of Law; Google Scholar), Bad Tax Policy Breeds Bad Blood Between Songwriters and Poets, 183 Tax Notes Fed. 1625 (May 27, 2024):

Taylor Swift’s songs inspire generations of fans to sing and dance about love and to shake off heartbreak. Swift’s hard-earned reputation for being a savvy music mogul inspires other creative spirits to be fearless in their artistic endeavors. However, unless these artists are songwriters or musicians, they should keep their eyes open when selling their works, as they may see red when they discover their tax rates.

For music listeners who are not English undergraduate majors turned tax law professors, there is no reason to know — or even care — that financially living one’s wildest dreams may depend on the taxpayer’s artistic medium. Provoked by Swift’s February proclamation, “All’s fair in love and poetry,” and the recent release of her album, The Tortured Poets Department, it has become my nerdy tax mission to highlight and amplify a curious dysfunction in U.S. tax law that distinguishes between songwriters and poets. 

Specifically, why does the code tax the sale of poems set to a beat more favorably than poems without a beat? In particular, songwriters may be eligible for preferential capital gains treatment, while poets will be subject to ordinary income rates. ...

Riffing off of Swift’s verses posted in her February Instagram proclamation, the “pitch black ink” of the code reveals two sharp truths. First, there is no tax relief for writers of love poems — only for those who write love songs. Second, ticking tax — not love — bombs may explode on less congressionally favored artists who sell their creative works. It is time for Congress to slay its tax monster so that love songs, stories, poems, and other artistic works are taxed harmoniously in a state of grace.