How Working Hollywood Loses Under the New Tax Bill
Tax experts weigh in on what the GOP tax plan means for entertainers
Ashley Boucher | December 20, 2017 @ 5:06 PM
Last Updated: December 21, 2017 @ 9:37 AM
The GOP tax plan that passed Wednesday is a victory for Donald Trump and the wealthy Hollywood elite who will benefit from tax breaks. But working actors may find themselves struggling more than ever because of deductions they may not be able to take anymore under the new plan.
Pasadena-based CPA Michael Di Pietro thinks the bill will cause a “miniature crisis” in Hollywood over the next 18 months. The Writer’s Guild of America West calls it “a disaster.”
If studios want actors and actresses to be available to them, they’re going to have to negotiate some sort of compromise, Di Pietro said, whether by increasing hourly wages to make up for no-longer available deductions or by some other means.
“It’s going to be something the industry has to work out, otherwise they’re gonna end up taking a major hit tax-wise,” Di Pietro told TheWrap in an interview Wednesday.
The new bill is hitting those who earn wages under a W2 the hardest, because employee business deductions are no longer allowed. Those deductions have, until the bill, covered expenses ranging from acting lessons to travel costs for auditions.
Other expenses, like gym memberships or plastic surgery, have always been in a “gray area,” Di Pietro said.
Tax attorney and treasurer for the Actors’ Equity Association Sandra Karas said that some physical expenses could be deducted if written into an actor’s contract — for example, if actors were required to dye their hair for a role.
Karas suspects that entertainers will scale back by taking fewer auditions and signing up for fewer acting classes. Agents may end up with fewer signed clients. Photographers will take fewer head shots.
Some, Karas fears, will leave the industry all together.
“People won’t have money to spend. Money never trickles down, ever, it always moves up,” Karas said. “And it moves up pretty quickly — it doesn’t trickle up, it moves up.”
WGAW’s statement on the bill echoed Karas’ sentiment, saying that the American economy “has become increasingly tilted toward inequality and the disappearance of the middle class.”
“Congress and the President have skewed the tax system heavily in favor of the rich; next they will use the resulting budget crisis to defund Medicare, public education and Social Security, all things that working Americans fought for and pay for,” the statement continued. “Middle-class writers are not immune to the forces of inequality. We will be doing our best to help writers understand the implications of this legislation for them. The WGAW stands with those who will resist.”
“Our members are spending anywhere from 10 to 30 percent of their gross income on these business expenses in a given year,” added Actors Equity communications director Brandon Lorenz. “So that’s just a huge chunk… losing that ability [to deduct those expenses] is a huge, huge, huge hardship.”
Karas reworked some Actors Equity members’ returns from last year under the new bill, and found increases in the thousands. One member would face an increase of $5,094, or 39 percent.
One possible work-around, Di Pietro said, is to go to one’s employer and ask for an 1099 instead of a W2.
“These individuals, their best course of action is to get their income in the form of 1099, then incorporate,” he said. “Because being a sole proprietor also has its drawbacks… So if they want to maintain those deductions and then some, and get the benefits of the tax bill… they need to become an independent contractor, and they need to become a corporation.”
Karas pointed out that while some members of the AEA, herself included, do some work on 1099, it’s usually not the main source of income. And still, employee business expenses “are going to be gone, gone, gone.”
Karas said that while a career in the entertainment industry has always been “precarious,” the new tax plan may deter middle- and working-class people from continuing to work in it.
“It’s a joyful life but it’s very unpredictable,” she said. “If they can’t maintain that, many of them might say, ‘You know, why don’t I find a regular nine-to-five gig and settle down with my dog and my significant other and call it a day. Maybe this industry’s not for me.’ And those are the people I fear we’ll lose from the sound stages, from the theatrical stages, from the dance classes, from everywhere.”
“And it’ll be a shame,” she said.
8 Unforgettable Hollywood Party Moments of 2017: From Fergie to Katy to Weinstein's Last Oscar Bash
The first surreal one-off industry gathering of 2017 was not a party, but a protest: the Women's March at the Sundance Film Festival. In between that Saturday morning in Park City, Utah, and the year ending with a less-merry-than-usual awards season marching through the industry sexual assault reckoning, there were standout moments on the Hollywood party circuit.
Here are eight of the best bashes, moments and debuts.
Chris Martin Serenades Julia Roberts With "Pretty Woman"
Chris Martin singing Pretty Woman for Julia Roberts who was honoured at #amfARLosAngeles! | via @desireegruber #coldplay #chrismartin
A post shared by Coldplaying (Official Account) (@coldplayinghq) on Oct 14, 2017 at 8:52am PDT
At the L.A. amfAR Gala in October, this crazy rare performance of the Coldplay frontman serenading the movie star on the eve of her 50th birthday got lost in blowback over James Corden's Harvey Weinstein jokes. Separate from that controversy, the Tom Hanks, Goldie Hawn and Kate Hudson dinner party in Ron Burkle's Bel Air backyard hit all the right notes.
As dessert, Fergie danced her way through the crowd while singing "I've Gotta Feeling," ruining all future wedding and bar mitzvah bandleaders' attempts at the same for the rest of our lives.
CAA's Emmy Celebration
Reese Witherspoon, Sarah Paulson, JJ Abrams, Seth MacFarlane, Laura Dern, Kevin Bacon, and Dwayne Wade amongst the crowd at the CAA Emmys Party 2017. (Alex Berliner/AB Images)
This Beverly Hills soiree left me asking one question:
"Jane's" Hollywood Bowl Movie Premiere
"Star Wars: The Last Jedi" wasn't the only film to get a super-sized rollout this year. In October, National Geographic and Brett Morgen leveled-up with a King Kong-sized outdoor seated dinner, premiere and live orchestra scoring the Jane Goodall documentary for over 15,000 guests.
John Mayer Plays An L.A. Dive Bar
Jon Mayer played a dive bar in the Echo Park section of L.A. on July 26. (Rich Fury, Getty Images for Bud Light)
There was a surprise within a surprise when Alessia Cara joined John Mayer's Bud Light Dive Bar Tour on July 26. They sang together an Erykah Badu cover, "Gravity" and Cara's "Stay" for just 300 fans, part of a full 90-minute set. The beer giant's muscular "underplay" went over big, with Lady Gaga beating this same path amidst the Super Bowl Halftime Show and stepping in as an emergency replacement headliner at Coachella.
The Block Is Hot in Hollywood
TAO Group's Noah Tepperberg, Pavan Pardasani, and Jason Strauss and team celebrated the opening of their new entertainment block in Hollywood on Thursday, March 16. (Instagram (2))
The undisputed L.A. nightlife game change in 2017 was the arrival of the Tao Group complex in Hollywood. The three restaurants, Avenue nightclub and the mixed-use rooftop pool club and night lounge The Highlight Room enveloping the new Dream Hotel tilted the social axis. The New York and Vegas heavyweights waited over a decade before planting a flag in L.A., but when they did, their peers came to celebrate.
On scene on opening night: David Grutman (Liv, Story, Komodo - Miami), Mark Birnbaum (Catch - LA and NYC), Rande Gerber, Cindy Crawford (Getty Images)
The opening night party back in March was a stunning congress of hospitality rivals, competitors, big shots (present and long ago retired), festival titans, and at least a few former partners-turned-litigants, all responsible for captaining the U.S. nightlife industry over the past three decades. Of course, Leo D. was in the corner booth.
Nobody will ever remember that one of the sneak peek pre-opening events was the (last-ever) Weinstein Company Oscar night viewing party.
Rapper Desiigner Pukes on a Table in Front of his Label Bosses, as Katy Perry Mocks PopÂ
Capitol CEO Steve Barnett, Katy Perry, and Universal Music Group CEO Lucian Grange at Grange's Grammy Weekend showcase at the Ace Theater in L.A. on February 11, 2017. (Lester Cohen/WireImage)
This list is heavy on music, but those guys have the most fun.
On the afternoon before the Grammys, Universal Music Group's four-hour-plus showcase at the Ace Hotel in downtown L.A. brought artists as varied as Machine Gun Kelly, Bishop Briggs, Niall Horan, Jordan Smith and Lil Yachty to the stage for an industry audience of label heads.
Desiigner rose to the occasion (literally, standing on a cocktail table with his shirt off) by vomiting twice mid-song, and Katy Perry recalled her time working in a cubicle in Calabasas.
Sir Lucian, this event needs a TV deal.
Genius Innovation: Shared Table Bottle ServiceÂ
The sharing economy of Lyft, Airbnb and urban Bike Share came to nightclub bottle service this year.
Dubbed "V-I-We," it is the brainchild of longtime TAO executive Mike Snedegar. The Kentucky native launched it with a professional infomercial. (See above, he plays newsman Kent Brockman).
Between 40-50 guests a night -- think of bachelorettes on a budget, couples and younger clientele -- get access to the VIP Skybox where Kim Kardashian has celebrated her birthday on the E! show for bottomless bottles at the Las Vegas hotspot for a $100 flat buy-in (plus tax and gratuity).
Cocktail waitresses mix the drinks, presumably to keep the peace, and patrol the party pests known as "Grey Goosae Vulturus," latin for "bottle vultures."
"It's a party within a party," Snedegar told The Party Report at launch.
George Clooney, Rande Gerbe, and Mike Meldman's Casamigos Halloween on the Sunset Strip
In June, the celebrity tequila buds sold their startup spirit in a deal reported to be worth up to $1 billion. This upped the volume on their '70s-themed Halloween party in the old Tower Records on Sunset.
While George did not make it, Mrs. Amal Clooney stole the show, along with the Kardashian "Sonny and Cher" costume, and Adam Levine (center), whose band played a surprise set as AC/DC.
Bonus: A 2018 Red Carpet Game Changer?
A post shared by Polaroid (@polaroid) on Nov 20, 2017 at 6:28am PST
There's now a device that snaps on to the back of your phone that will have you shaking your photos of Chris Martin, Kim Kardashian, Amal Clooney and more like a you-know-what.
This Polaroid Insta-Share is a hardware mod for the Motorola's Moto Z phone. Other mods can turn phones in to 70-inch projectors and 360-degree cameras. This printer's won some "Best of the Best" awards among tech press, but hasn't yet dented the binary iPhone/Samsung mindset of the entertainment industry and event community as a red carpet novelty.
Wake up people!
Oscars 2018 Party Report: 'The Final Year', 'Call Me by Your Name' and Brooklynn Prince on the Scene (Photos)
"The Final Year" Director Greg Barker and star/Ambassador Samantha Power
"Each individual (watching 'The Final Year') seems to have a different ratio of 'depressed-nostalgic' on the one hand and 'inspired-activated' on the other, " former U.S. Ambassador to the U.N. Samantha Power said at a screening of the much-anticipated doc at Neuehouse on Monday night. The documentary covers President Obama's foreign policy team's globe-trotting spring to the finish of their administration, mainly before the shock election result. Power flew in from Boston to address an intimate audience at Neuehouse on Sunset who got an early look at the film.
Mikey Glazer
Co-Producer Diane Becker, Producer Julie Goldman, Barker, and Power
"For the next 90 minutes, Obama is still President," Goldman said while introducing the film. Beyond serving as a mental refuge in the Trump era, this intimate look at big and small moments of foreign diplomacy will be cited thousands of times in application essays to Georgetown's School of Foreign Service.
Mikey Glazer
Victors
At an early awards season tentpole in New York, "Call Me by Your Name" won the Best Feature award at the IFP Gotham Awards at Cipriani Wall Street on Monday night, Nov. 27.
Bryan Bedder and Craig Barritt / Getty Images
Brooklynn Prince
The tiny star of "The Florida Project" continues to be the toast of awards season, chatting up Reese Witherspoon at the same event.
Bryan Bedder and Craig Barritt / Getty Images
Adam Sandler and Ben Stiller
Not often in the mix during awards season, the two comics are still supporting "The Meyerowitz Stories (New and Selected)," which debuted at Cannes.
Bryan Bedder and Craig Barritt / Getty Images
Ethan Hawke and Nicole Kidman
The two stars have impressive background music in the form of Ron Meyer (left) and Kevin Huvane (right). On the tables, red Lindt LINDOR chocolate gift boxes were an early holiday gift for attendees.
Andrew Toth / Getty Images
Mary J. Blige and Allison Williams
While Blige has been everywhere this season, Williams has been more scarce. Supporting her turn in "Get Out," Jordan Peele's film won Best Director, Screenplay and the Audience Award as sponsors Fiji Water and Landmark Vineyards kept the crowd hydrated.
Bryan Bedder and Craig Barritt / Getty Images:
The Dolls
While Hollywood was in NYC, a bit of NYC came to L.A. Mia Moretti and violinist Margot provided the soundtrack at Zynderia Studios as Corvette revealed a new 2019 edition, the ZR1. The L.A. Auto show bash scattered red carpets across the city this week.
Courtesy of Corvette
Get a peek at more Oscar contenders hitting the party circuit here:
Inside and backstage the early awards season bashes with the contenders
"The Final Year" Director Greg Barker and star/Ambassador Samantha Power
"Each individual (watching 'The Final Year') seems to have a different ratio of 'depressed-nostalgic' on the one hand and 'inspired-activated' on the other, " former U.S. Ambassador to the U.N. Samantha Power said at a screening of the much-anticipated doc at Neuehouse on Monday night. The documentary covers President Obama's foreign policy team's globe-trotting spring to the finish of their administration, mainly before the shock election result. Power flew in from Boston to address an intimate audience at Neuehouse on Sunset who got an early look at the film.
The Party Report inducts a select few Hollywood events and innovations from 2017 into a “Post of Fame”
The first surreal one-off industry gathering of 2017 was not a party, but a protest: the Women's March at the Sundance Film Festival. In between that Saturday morning in Park City, Utah, and the year ending with a less-merry-than-usual awards season marching through the industry sexual assault reckoning, there were standout moments on the Hollywood party circuit.
Here are eight of the best bashes, moments and debuts.
Chris Martin Serenades Julia Roberts With "Pretty Woman"
Chris Martin singing Pretty Woman for Julia Roberts who was honoured at #amfARLosAngeles! | via @desireegruber #coldplay #chrismartin
A post shared by Coldplaying (Official Account) (@coldplayinghq) on Oct 14, 2017 at 8:52am PDT
At the L.A. amfAR Gala in October, this crazy rare performance of the Coldplay frontman serenading the movie star on the eve of her 50th birthday got lost in blowback over James Corden's Harvey Weinstein jokes. Separate from that controversy, the Tom Hanks, Goldie Hawn and Kate Hudson dinner party in Ron Burkle's Bel Air backyard hit all the right notes.
As dessert, Fergie danced her way through the crowd while singing "I've Gotta Feeling," ruining all future wedding and bar mitzvah bandleaders' attempts at the same for the rest of our lives.
CAA's Emmy Celebration
Reese Witherspoon, Sarah Paulson, JJ Abrams, Seth MacFarlane, Laura Dern, Kevin Bacon, and Dwayne Wade amongst the crowd at the CAA Emmys Party 2017. (Alex Berliner/AB Images)
This Beverly Hills soiree left me asking one question:
"Jane's" Hollywood Bowl Movie Premiere
"Star Wars: The Last Jedi" wasn't the only film to get a super-sized rollout this year. In October, National Geographic and Brett Morgen leveled-up with a King Kong-sized outdoor seated dinner, premiere and live orchestra scoring the Jane Goodall documentary for over 15,000 guests.
John Mayer Plays An L.A. Dive Bar
Jon Mayer played a dive bar in the Echo Park section of L.A. on July 26. (Rich Fury, Getty Images for Bud Light)
There was a surprise within a surprise when Alessia Cara joined John Mayer's Bud Light Dive Bar Tour on July 26. They sang together an Erykah Badu cover, "Gravity" and Cara's "Stay" for just 300 fans, part of a full 90-minute set. The beer giant's muscular "underplay" went over big, with Lady Gaga beating this same path amidst the Super Bowl Halftime Show and stepping in as an emergency replacement headliner at Coachella.
The Block Is Hot in Hollywood
TAO Group's Noah Tepperberg, Pavan Pardasani, and Jason Strauss and team celebrated the opening of their new entertainment block in Hollywood on Thursday, March 16. (Instagram (2))
The undisputed L.A. nightlife game change in 2017 was the arrival of the Tao Group complex in Hollywood. The three restaurants, Avenue nightclub and the mixed-use rooftop pool club and night lounge The Highlight Room enveloping the new Dream Hotel tilted the social axis. The New York and Vegas heavyweights waited over a decade before planting a flag in L.A., but when they did, their peers came to celebrate.
On scene on opening night: David Grutman (Liv, Story, Komodo - Miami), Mark Birnbaum (Catch - LA and NYC), Rande Gerber, Cindy Crawford (Getty Images)
The opening night party back in March was a stunning congress of hospitality rivals, competitors, big shots (present and long ago retired), festival titans, and at least a few former partners-turned-litigants, all responsible for captaining the U.S. nightlife industry over the past three decades. Of course, Leo D. was in the corner booth.
Nobody will ever remember that one of the sneak peek pre-opening events was the (last-ever) Weinstein Company Oscar night viewing party.
Rapper Desiigner Pukes on a Table in Front of his Label Bosses, as Katy Perry Mocks PopÂ
Capitol CEO Steve Barnett, Katy Perry, and Universal Music Group CEO Lucian Grange at Grange's Grammy Weekend showcase at the Ace Theater in L.A. on February 11, 2017. (Lester Cohen/WireImage)
This list is heavy on music, but those guys have the most fun.
On the afternoon before the Grammys, Universal Music Group's four-hour-plus showcase at the Ace Hotel in downtown L.A. brought artists as varied as Machine Gun Kelly, Bishop Briggs, Niall Horan, Jordan Smith and Lil Yachty to the stage for an industry audience of label heads.
Desiigner rose to the occasion (literally, standing on a cocktail table with his shirt off) by vomiting twice mid-song, and Katy Perry recalled her time working in a cubicle in Calabasas.
Sir Lucian, this event needs a TV deal.
Genius Innovation: Shared Table Bottle ServiceÂ
The sharing economy of Lyft, Airbnb and urban Bike Share came to nightclub bottle service this year.
Dubbed "V-I-We," it is the brainchild of longtime TAO executive Mike Snedegar. The Kentucky native launched it with a professional infomercial. (See above, he plays newsman Kent Brockman).
Between 40-50 guests a night -- think of bachelorettes on a budget, couples and younger clientele -- get access to the VIP Skybox where Kim Kardashian has celebrated her birthday on the E! show for bottomless bottles at the Las Vegas hotspot for a $100 flat buy-in (plus tax and gratuity).
Cocktail waitresses mix the drinks, presumably to keep the peace, and patrol the party pests known as "Grey Goosae Vulturus," latin for "bottle vultures."
"It's a party within a party," Snedegar told The Party Report at launch.
George Clooney, Rande Gerbe, and Mike Meldman's Casamigos Halloween on the Sunset Strip
In June, the celebrity tequila buds sold their startup spirit in a deal reported to be worth up to $1 billion. This upped the volume on their '70s-themed Halloween party in the old Tower Records on Sunset.
While George did not make it, Mrs. Amal Clooney stole the show, along with the Kardashian "Sonny and Cher" costume, and Adam Levine (center), whose band played a surprise set as AC/DC.
Bonus: A 2018 Red Carpet Game Changer?
A post shared by Polaroid (@polaroid) on Nov 20, 2017 at 6:28am PST
There's now a device that snaps on to the back of your phone that will have you shaking your photos of Chris Martin, Kim Kardashian, Amal Clooney and more like a you-know-what.
This Polaroid Insta-Share is a hardware mod for the Motorola's Moto Z phone. Other mods can turn phones in to 70-inch projectors and 360-degree cameras. This printer's won some "Best of the Best" awards among tech press, but hasn't yet dented the binary iPhone/Samsung mindset of the entertainment industry and event community as a red carpet novelty.
Wake up people!
Oscars 2018 Party Report: 'The Final Year', 'Call Me by Your Name' and Brooklynn Prince on the Scene (Photos)
"The Final Year" Director Greg Barker and star/Ambassador Samantha Power
"Each individual (watching 'The Final Year') seems to have a different ratio of 'depressed-nostalgic' on the one hand and 'inspired-activated' on the other, " former U.S. Ambassador to the U.N. Samantha Power said at a screening of the much-anticipated doc at Neuehouse on Monday night. The documentary covers President Obama's foreign policy team's globe-trotting spring to the finish of their administration, mainly before the shock election result. Power flew in from Boston to address an intimate audience at Neuehouse on Sunset who got an early look at the film.
Mikey Glazer
Co-Producer Diane Becker, Producer Julie Goldman, Barker, and Power
"For the next 90 minutes, Obama is still President," Goldman said while introducing the film. Beyond serving as a mental refuge in the Trump era, this intimate look at big and small moments of foreign diplomacy will be cited thousands of times in application essays to Georgetown's School of Foreign Service.
Mikey Glazer
Victors
At an early awards season tentpole in New York, "Call Me by Your Name" won the Best Feature award at the IFP Gotham Awards at Cipriani Wall Street on Monday night, Nov. 27.
Bryan Bedder and Craig Barritt / Getty Images
Brooklynn Prince
The tiny star of "The Florida Project" continues to be the toast of awards season, chatting up Reese Witherspoon at the same event.
Bryan Bedder and Craig Barritt / Getty Images
Adam Sandler and Ben Stiller
Not often in the mix during awards season, the two comics are still supporting "The Meyerowitz Stories (New and Selected)," which debuted at Cannes.
Bryan Bedder and Craig Barritt / Getty Images
Ethan Hawke and Nicole Kidman
The two stars have impressive background music in the form of Ron Meyer (left) and Kevin Huvane (right). On the tables, red Lindt LINDOR chocolate gift boxes were an early holiday gift for attendees.
Andrew Toth / Getty Images
Mary J. Blige and Allison Williams
While Blige has been everywhere this season, Williams has been more scarce. Supporting her turn in "Get Out," Jordan Peele's film won Best Director, Screenplay and the Audience Award as sponsors Fiji Water and Landmark Vineyards kept the crowd hydrated.
Bryan Bedder and Craig Barritt / Getty Images:
The Dolls
While Hollywood was in NYC, a bit of NYC came to L.A. Mia Moretti and violinist Margot provided the soundtrack at Zynderia Studios as Corvette revealed a new 2019 edition, the ZR1. The L.A. Auto show bash scattered red carpets across the city this week.
Courtesy of Corvette
Get a peek at more Oscar contenders hitting the party circuit here:
Inside and backstage the early awards season bashes with the contenders
"The Final Year" Director Greg Barker and star/Ambassador Samantha Power
"Each individual (watching 'The Final Year') seems to have a different ratio of 'depressed-nostalgic' on the one hand and 'inspired-activated' on the other, " former U.S. Ambassador to the U.N. Samantha Power said at a screening of the much-anticipated doc at Neuehouse on Monday night. The documentary covers President Obama's foreign policy team's globe-trotting spring to the finish of their administration, mainly before the shock election result. Power flew in from Boston to address an intimate audience at Neuehouse on Sunset who got an early look at the film.
Mikey Glazer
Mikey Glazer
