Americans for the Arts

Nina Ozlu Tunceli

The following are some quick highlights of the Fiscal Cliff Tax Legislation that was enacted into law Monday night. The legislation only addresses major tax issues, while raising the debt ceiling limits and preventing the automatic sequestration spending cuts from beginning will be dealt with over the next two months:

• Charitable Deductions: Good news is that the charitable tax giving incentives were not specifically capped and no changes were made to the exempt status or classification of charities, such as nonprofit arts organizations. While no changes have been made in this first round of fiscal cliff negotiations, tax reform revenue raisers are still on the table as Congress and the White House negotiate staving off deep sequestration cuts in the next two months. Americans for the Arts will continue advocating the importance of this issue on behalf of the nonprofit arts sector.
• Personal Exemptions and Itemized Deductions: Unfortunately, the new tax law does reinstate both the Personal Exemption limitation and the "Pease limitation," (named after former Congressman Donald Pease (D-OH)), which will reduce the overall amount of itemized deductions (including home mortgage, charitable, local and state taxes, etc) by three percent of only that amount that exceeds the threshold (but not to exceed 80% of total itemized deductions that would have been taken). These deduction limitations are not a cap and they only kick-in for married couples earning more than $300,000 and singles earning more than $250,000 annually.

Here’s how it works: If married taxpayers earn $1 million and have total itemized deductions of $190,000 (home mortgage interest, charity donations, state/local taxes combined) in 2013, they will not be able to deduct the full $190,000 from their income. They will only be able to deduct $169,000 ($190,000 - $21,000) because the PEASE limitation rule reduces the deduction by the equivalent of 3% of the amount of their income above the $300,000 threshold ($1 million - $300,000 = $700,000 is the amount above the threshold). The reduction would then be $21,000 ($700,000 x 3% = $21,000). These rules were in effect in the 1990’s, but had been temporarily phased out during the Bush-era tax cuts in the previous decade.
• IRA Rollover: extends for two years, retroactive to 2012, allowing donors age 70½ or older to donate to charities tax-free from their IRAs. Important note: donation deadlines have been extended by a month so that donors can designate their IRA distributions to a charity in January 2013, but still have the deduction apply to tax year 2012.

On the steps of Brooklyn's Borough Hall earlier today, I joined Academy Award nominated actress Rosie Perez and New York City Councilman Robert Jackson for a rally to call attention to the fact that Time Warner Cable eliminated Ovation from their cable television line-up on December 31.

While speaking at the podium during the Bring Back Ovation Rally in New York today, I was joined by actress Rosie Perez (pictured on the far left) and New York City Councilman Robert Jackson (over my left shoulder).

As a national organization representing more than 250,000 arts advocates and local and state arts agencies in every city and state across the country, we're very concerned about this action since Ovation is currently the only dedicated arts channel in the United States.

The mission of Americans for the Arts is to increase the American public's access to high-quality arts in our communities, schools, and homes. Ovation has been an incredible partner in helping us advance our mission thus far, but we also need Ovation to remain strong and accessible on the television airwaves. There's nothing that will fill the void created by Time Warner Cable's decision.

Today, we encourage our arts advocates to sign the online petition demanding the network be reinstated on Time Warner Cable at www.BringBackOvation.com!  

Mayor Antonio Villaraigosa speaks at The National Press Club.

Los Angeles Mayor Antonio Villaraigosa was the keynote speaker yesterday at the National Press Club here in Washington, DC.

As he completes his final term as mayor this year, and as the immediate past president of The United States Conference of Mayors, Mayor Villaraigosa delivered his vision on the main issue that he plans to continue working on going forward—urging Congress to pass immigration reform and create pathways to citizenship, leaving immigration enforcement agents to focus on violent criminals and give those who have not been through the criminal justice system an opportunity to become citizens.

While a direct connection to the arts isn't obvious, immigration reform is an issue that also impacts artists and nonprofit arts and cultural organizations. For instance, foreign guest artists continue to have problems entering the United States in order to attend their exhibitions and performing events.

Americans for the Arts has been working to amend immigration reform legislation to include streamlining this provision for several years. Here is part of our "Statement of Concern" utilized as part of our Arts Advocacy Day efforts last year:

Nina Ozlu Tunceli

I'm here in Chicago at the National Mayors Summit on City Design sponsored by U.S. Conference of Mayors, National Endowment for the Arts, and the Architectural Foundation.

Yesterday, I participated in working sessions with mayors, city planners, and architects to develop a series of recommendations to federal officials of how to streamline partnerships to create economic development and improve city infrastructure.

Specifically, I made several recommendations, including creating incentive funding for cultural districts and public art programs in federal infrastructure projects and economic development zones.

I am pleased to say that I was not the only carrying messages about the importance of the arts.