Tax Incentives for Artists

A “qualified residing artist” who lives in Maryland and sells “artistic work” in any of the 29 A&E Districts throughout the State is eligible for the income tax subtraction modification on income derived from their in-district sales (for performing artists, this includes income derived from performances in a district; for all “qualified residing artists”, this includes internet sales originating in a district).

Eligible artists should submit a Form 502AE with their annual state tax filing to claim the modification. Click here to access Form 502AE.

To determine eligibility, review the definitions below. The Income Tax Subtraction Modification (ITSM) flowchart (click here to view) can help determine eligibility for that incentive, as can the ITSM FAQ. If you have additional questions after reviewing these materials, click here to complete Maryland State Art Council’s A&E Districts Question Form.

 

  • “Artistic work” means an original and creative work that:
    • is created, written, composed, or executed, either alone or with others; and
    • falls into one of the following categories:
      • (i) a book or other writing;
      • (ii) a play or performance of a play;
      • (iii) a musical composition or the performance of a musical composition;
      • (iv) a painting or other picture, including a photograph;
      • (v) a sculpture;
      • (vi) traditional or fine crafts, including works of cultural expression;
      • (vii) the creation of a film or the acting within a film;
      • (viii) the creation of a dance or the performance of a dance;
      • (ix) the design or creation of original jewelry, clothing, or other functional art;
      • (x) storytelling or a storytelling performance;
      • (xi) a digital or new media design or performance; or
      • (xii) any other product generated as a result of a work or combination of works listed in items (i) through (xi) of this paragraph.
  • “Qualifying residing artist” means an individual who:
    • owns or rents residential real property in the State;
    • conducts a business in any arts and entertainment district; and
    • derives income from the sale or performance within any arts and entertainment district of an artistic work that the individual wrote, composed, or executed, either alone or with others, in any arts and entertainment district.

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