New bipartisan legislation would help independent musicians affected by the COVID-19 pandemic. Rep Linda T. Sanchez (D-Ca) introduced H.R. 7886, titled the Help Independent Tracks Succeed (HITS) Act. It is cosponsored by Rep. Ron Estes (R-Ks).
According to The Recording Academy, who are supporting the legislation, the HITS Act “allows an individual to fully expense for tax purposes the cost of new studio recordings on their taxes, up to $150,000, within the same year of production.” This would help alleviate the costs of creating new music.
The Academy explains that musicians have been hard hit by the COVID-19 pandemic because studios, concert halls, bars, restaurants and other performance venues remain closed. Since the average musician makes less than $25,000 every year, the cost of production and the tax burden could weigh heavily on producers and artists. Currently, for tax purposes, they have to pay off production expenses for up to four years. The HITS Act would allow artists and producers to deduct all domestic production expenses for the year those production costs were made. These expenses include rental fees, equipment, electricity and many other costs, according to The Academy.
“The HITS Act will make a meaningful impact and help ease the financial burden for thousands of independent creators getting back on track, eager to share their creativity with the world,” said Recording Academy chair and interim president/CEO in a press release. “It will inspire new music and create opportunities for many of the vulnerable professionals in our community to persevere during these uncertain times.”
The legislation comes as venues and promoters are struggling to grapple with the effects of the pandemic. In June, AEG president Jay Marciano wrote in a memo that pay cuts would happen and layoffs would affect 15 percent of the company’s workforce. William Morris Agency‘s parent company, Endeavor Group Holdings, laid off 250 employees in May. In March, Paradigm Talent Agency laid off about 100 of its employees.
In June, several artists, including Lady Gaga, Bon Iver, Patti Smith and Kacey Musgraves, wrote a letter to Congress urging them to help music venues, especially smaller ones. In July, Sen. Amy Klobuchar (D-Mn) and Sen. John Cornyn (R-Tx) introduced the Save Our Stages Act to help struggling venues.
Photo Credit: Mauricio Alvarado