Orphan Works

Every creative person should know the details of the Orphan Works legislation currently being considered by Congress. The Graphic Artists Guild has provided the bills below to inform artists of all kinds about the status of the legislation as of September 27, 2008.  Updates will follow, so please be sure to subscribe to our RSS feed to get up-to-the-minute updates.

The Senate bill (S. 2913) has been approved and sent to the full Senate for approval. The House version of the bill (H.R. 5889) was referred by Subcommittee to Full Committee on May 7, 2008. The Senate bill (S. 2913) passed by unanimous consent on September 26, 2008.

In the event that the two branches pass differing versions of the law, the bills will be forwarded to a reconciliation committee. The language of the two bills are consolidated and then presented to the President for final approval before becoming law.

The Guild has also included the Copyright Law of the United States.  This legislation was initiated as a single page more than 200 years ago and has grown to more than 300 pages during subsequent revisions.  Orphan Works legislation is clearly not the first challenge to the creative community, but the Guild has advocated for artists’ rights for the past 41 years and will continue to do so well into the future.

Artist-Museum Partnership Act

Before 1969 artists, composers and writers could donate self-generated works to a non-profit institution and receive a fair-market-value deduction. Subsequent to 1969, as part of broad tax reform, they can deduct only the cost of materials.

Currently, artists making a charitable contribution to a museum or cultural institution are only allowed to deduct the cost of their raw materials instead of the fair market value of the art donated. This situation deters artists from donating art to a museum while they are alive, and instead waiting until after they die, because their work is valued at fair market value in their estate. However, if they donate while alive, they get only a deduction for the costs of their materials.

As a result of the 1969 legislation, many works of art which would have been contributed to American institutions have been sold into private collections or abroad, in effect depriving the public of these works. (For example, Igor Stravkinsky planned to donate his papers to the Music Division of the Library of Congress the month the Tax Reform Act of 1969 was signed into law. Instead, the papers were sold to a private foundation in Switzerland.) If the widow(er) of an artist donates a work of art created by his/her deceased spouse, the widow(er) can take a fair-market-value deduction, as can the collector of the artist’s work. In addition, the artist’s estate is taxed at fair-market value. Finally, a patent holder who contributes his/her patent can take a fair-market-value deduction for the contribution. The benefit to the nation, when artists are encouraged to contribute their work during their lifetime, cannot be overemphasized. It allows the public, historians, scholars and others to learn from the artist his/her aesthetic intention for the work; how it was intended to be displayed, performed, or interpreted; and what influences affected the artist.

The passage of the Artist-Museum Partnership Act of 2011 would have the following positive impact:

  1. Increasing incentives for artists to donate their work will improve public collections, since most nonprofit institutions have no acquisition funds to purchase creative work and must rely on donations.
  2. The tax code would encourage donations from our most creative citizens for future generations to enjoy, a plus for nonprofit institutions that have no acquisition funds to purchase creative works and must rely on donations.
  3. Artists would be treated as any other taxpayer donating a work of appreciated property, creating a tax code with “horizontal tax equity”—equal treatment to all similarly situated taxpayers.
  4. Encouraging donations directly from living artists will make more art accessible to the general public more quickly than waiting for estates to be settled or for art to pass through the hands of collectors.

Click here for a copy of H.R. 5889 (Adobe Acrobat file, 71 Kb)

Click here for a copy of S. 2913 (Adobe Acrobat file, 44 Kb)

Click here for a copy of the Copyright Law of the United Sates (Adobe Acrobat file, 2908 Kb)