Efforts to eliminate the punitive treatment of writers that Congress unwittingly wrote into the 1986 Tax Reform Act seem to have run into a snag masquerading as "compromise." Though fairness demands that writers simply be returned to the position they previously enjoyed -- with the right, shared by all other self-employed professionals, to deduct legitimate business expenses as they are incurred -- a move is afoot in the Treasury Department to place an annual "cap" on deductions and to require that the balance be amortized; this has nothing to do with compromise and everything to do with discrimination, however unintentional it may be.
Why it is that writers should be the victims of such bias, at Treasury in particular but elsewhere in the tax-writing system as well, is surely one of the year's more baffling mysteries. What is it that writers have done to be singled out, alone among comparably self-employed people, for tax regulations that bear no fair or responsible relationship to the realities of how they work?
The answer seems to be that tax policy as it affects writers is being formulated by people who have little idea of who writers really are or how they really work. This is quite understandable -- most writers, after all, know little or nothing about how the Treasury works -- but it is also quite unfortunate, as the people who will pay the price for this ignorance are honest and hard-working writers who deserve a better deal from their government.
Perhaps because so many well-known and prosperous writers have come to Capitol Hill to lobby for a change in the tax law, the notion has gained currency that they are representative of the breed. But as they would be the first to point out, nothing could be further from the truth. The percentage of writers whose work gets on the best-seller lists, who appear on television with Johnny Carson and Oprah Winfrey, who take winter vacations in the Caribbean, who win literary or journalistic awards, is ridiculously small; reality, for most writers, is something else again.
Reality is a makeshift office, usually in one's apartment or house, often not a separate room but a desk and file cabinet in a bedroom corner. Reality is an utterly uncertain income that hangs on the whim of bursars at magazines, newspapers, publishing houses and other sources of free-lance income. Reality is word processor service contracts or typewriter repairs, air and auto travel, motel rooms, postage, stationery and erasable bond, photocopies. Reality is a marketplace at once intensely competitive and severely limited -- competitive because of the number of people in it, limited because fees and royalties are generally small.
Reality, for most writers, has nothing to do with "The Reckoning" or "The Accidental Tourist." Not merely are most writers scarcely so talented as David Halberstam or Anne Tyler, but most work at a far less elevated level. Most writers plug away, unknown and unnoticed, at the workaday materials used by a literate society. They write books and articles about coping with arthritis or AIDS, about fixing leaky faucets or malfunctioning appliances, about managing corporate offices or small businesses. If they write fiction, it is more likely to be romance novels or westerns -- or books for children -- than brittle exercises in minimalism.
Writers are small in number -- perhaps 15,000 in a country of nearly 250 million -- but they provide important, practical, useful services for millions of Americans, as well as enlightenment and entertainment; they aren't on the lunatic or even intellectual fringe, but in the mainstream of American professional and commercial life. Nor is there any real reason to believe, as some at Treasury and elsewhere do, that they are any more devious or dishonest in the compilation of their tax returns than any other comparable group.
People claim writing expenses when they are not producing income, it is argued, or writers claim expenses -- trips to Europe, lavish meals in New York -- that are only marginally connected to the books or articles on which they ostensibly are working; therefore, the argument runs, there should be restrictions on how their expenses are deducted. But those restrictions already exist. The so-called Hobby Rule, which is regularly enforced by the Internal Revenue Service, requires that a self-employed person make a profit three out of five years in order to take business deductions; and the IRS already has ample regulations with which to deal with all taxpayers, writers included, who cheat on claims for business expenses.
No, there is no justifiable reason for singling out writers for discriminatory treatment; the only reason, an indefensible one at best, is that a misunderstanding at the staff level led to a footnote in the 1986 law that no one in Congress seems to have known was there. But now that it has inadvertently become law, it seems to have become holy writ: Alone among self-employed professionals, writers must amortize expenses over the predicted income-producing life of their work, and they can only claim those expenses in years when that work produces income. Joseph Heller, where are you now that we need you?
But fear not: There are rumblings, at Treasury and on the Hill, of "compromise." Why not let writers deduct expenses up to an annual "cap" of $5,000, say, or $10,000, and then require them to amortize the rest, over, say, three years? The answer is both complex and simple. It is complex because, even under this so-called compromise, writers would still be required to forecast income, which is quite literally impossible in a notoriously unpredictable business, and to allocate expenses among writing projects in equally impossible ways; the "compromise" does not eliminate either of these insuperable difficulties.
Neither does the "compromise" recognize the reality of the writer's life. The so-called "cap" of $5,000 or $10,000 seems to have been arrived at not from a careful examination of writers' expenses, but from thin air or, more likely, from a figure idly tossed into the penultimate paragraph of a column by Michael Kinsley taking issue with the writers' complaints. With all due respect for the estimable Kinsley, the figure is pure whimsy, bearing no connection to what it is usually necessary to spend in order to maintain a writer's office and to meet his legitimate business expenses. In writing, as in any business, it is entirely possible to have large expenses and low net income, because many writing projects are exceedingly expensive to finance; there is absolutely no defensible reason why writers should be required to deduct those expenses in a less advantageous and more cumbersome arrangement than other self-employed workers.
But that is what writers will have to do unless Congress recognizes the accidental error of its ways and amends the 1986 act. They're asking not for special relief or particular treatment, but merely to be considered just as others in their position are. They are asking for fair treatment, and there can be no compromise where that is concerned