S. 1121 — Performing Artist Tax Parity Act of 2025

This section modifies the above-the-line deduction for unreimbursed employee business expenses of qualified performing artists (i.e., those who work for multiple employers in the performing arts, receive no significant reimbursement from any employer, and meet other criteria under current law) as follows: (1) establishes a phaseout that reduces allowable expenses (but not below zero) by 10 percentage points for each $2,000 ($4,000 for joint returns), or fraction thereof, by which the taxpayer's gross income exceeds $100,000 ($200,000 for joint returns), with both thresholds adjusted for inflation after 2025; (2) clarifies that the deduction includes commissions paid to the artist's manager or agent; (3) increases the threshold for treating an employer as nominal (i.e., not an employer for deduction purposes if total pay is $200 or less) to $500, with inflation adjustment after 2025; and (4) makes technical and conforming amendments. The changes apply to taxable years beginning after December 31, 2024.