Berlin Arts Benefits

Arts and Entertainment Districts

The Arts and Entertainment District Program was created by the Maryland General Assembly in 2001 to designate areas throughout the State that would use art and cultural resources to revitalize communities. The districts offer certain tax incentives to attract artists and arts and entertainment enterprises. By concentrating art and cultural resources, the districts can be a catalyst for revitalizing neighborhoods by stimulating business activity on nights and weekends, strengthening the tax basis and supplementing educational opportunities. Maryland, through the Department of Business and Economic Development, is the first state in the country to develop the Arts and Entertainment Districts on a statewide basis.

A&E District Benefits

The following tax benefits are available to qualifying persons or entities in A&E districts:

  • Real Property Tax Credit for the renovation of existing buildings or the construction of new buildings that are capable for use by “qualifying residing artists”.
    Berlin ResolutionRegistration Form
  • An Income Tax Subtraction Modification for income derived from artistic work sold by “qualifying resident artists”. Artists who qualify do not pay state or local income tax on income derived from artistic work created and sold within the district
    Registration FormTax Forms (from Maryland Taxation Website)
  • An exemption from the Admission and Amusement Tax levied on gross receipts from an admissions or amusement charge levied by an “arts and entertainment enterprise” or “qualifying residing artist” in a district.

Eligibility for Tax Credits

A “qualifying residing artist” is an individual who

  • Owns or rents residential real property in the County in which the district is located.
  • Conducts an arts or entertainment business in the district, and
  • Derives income from the sale or performance within the district of an artistic work that the individual wrote, composed, or executed wholly or primarily within the District, either solely or with one or more individuals.

An “artistic work” is an original and creative work, whether written, composed or executed within the designated A&E District that falls within certain specified categories. An artistic work does not include any pieces or performance created or executed for industry-oriented-or-related production, such as a commercial or advertising copy.

An “Arts and Entertainment Enterprise” is a for-profit or nonprofit entity dedicated to visual or performing arts.

Applying for A&E Designation

A&E Districts are designated by the Secretary or Business and Economic Development. In addition to meeting other criteria, a District must be wholly within a Smart Growth Priority Funding Area to be eligible. A county, a municipality or two or more political subdivisions may jointly apply if the proposed A&E District is within the common boundaries of each. Up to six Districts per year can be designated by the State; however any individual county can have only one District designated per year.

Applications for an area to be designated as an A&E District are accepted on April 1st and October 1st of each year. Designations are announced withing 60 days of the application deadline date.