HITS Act

A Historic Win for Independent Music

For decades, independent artists, songwriters, and producers were forced to amortize their studio recording costs over the economic life of a sound recording — even as their counterparts in film, television, and theater could fully expense production costs in the year they were incurred. That disparity tied up capital independent creators don't have to spare and made it harder to reinvest in new music.

The Help Independent Tracks Succeed (HITS) Act fixes that imbalance. On July 4, 2025, the bill's provisions were signed into law as part of the One Big Beautiful Bill Act, allowing artists, songwriters, producers, and record labels to deduct up to $150,000 in qualified sound recording production expenses in the year those costs are incurred, provided the recording is produced in the United States.

The HITS Act was first introduced in 2020 at the height of the COVID-19 pandemic, when music creators were among the first out of work as tours, festivals, and studio sessions came to a halt. After more than five years of dedicated advocacy by the Recording Academy and its members — including a near-miss in the 2021 Build Back Better Act — the bill's provisions were finally enacted in the 119th Congress.

What The Bill Does

Deductible expenses include any costs directly related to creating a recording: studio time rental fees, payments to session musicians, engineer and producer fees, mixing and mastering costs, and equipment purchases or rentals. The deduction applies to song demos, albums, EPs, singles, and digital-only releases. Marketing, touring, and distribution costs are not eligible.

The HITS Act also includes a "bonus depreciation" provision that allows expenses to be claimed in the year a qualified sound recording is "placed in service" — the time of initial release or broadcast — giving creators flexibility to find the tax treatment that works best for their situation.

Who Supported The HITS Act

The HITS Act was championed in Congress by Reps. Linda Sánchez (D-California) and Ron Estes (R-Kansas) in the House, and Sens. Marsha Blackburn (R-Tennessee) and Catherine Cortez Masto (D-Nevada) in the Senate. The Recording Academy also worked closely with House Ways & Means Chairman Jason Smith (R-Missouri) to ensure the HITS Act was included in the final domestic policy package.

The Academy led a broad coalition of music organizations in supporting the bill, including A2IM — which mobilized its network of more than 700 independent labels — and the Nashville Songwriters Association International (NSAI), which worked to ensure the HITS Act applied to songwriters. The HITS Act was also endorsed by SAG-AFTRA, the Music Artists Coalition, Artists Rights Alliance, RIAA, NMPA, SoundExchange, Global Music Rights, SESAC, NIVA, NITO, the Future of Music Coalition, Digital Media Association, ASCAP, BMI, the Gospel Music Association, the Christian Music Trade Association, and Songwriters of North America.