Visual Artists Get 5% Cut on Resales Over $5,000: New Federal Royalty System Kicks Off in 2026

The American Royalties Too Act of 2025 is aiming to fundamentally change how visual artists get paid when their work hits the secondary market. If you’ve ever wondered why musicians and writers get royalties from resales but painters and sculptors usually don’t, this bill is the answer. It creates a mandatory federal resale royalty right: if a piece of visual art sells commercially for $5,000 or more after the first sale, the artist (or their heirs) gets 5% of the resale price. This royalty is capped at $50,000 per sale, a limit that will adjust annually for inflation starting in 2026. The entire system goes into effect one year after the bill becomes law.

The Art Market’s New Accounting Headache

This new rule primarily targets “Art Market Professionals”—think galleries, auction houses, and major dealers. If they handle a commercial resale of qualifying art, they are responsible for tracking the sale, collecting the 5% fee, and handing it over to a designated Visual Artists Collecting Society within 90 days. For the artist, this is a clear win, ensuring they get a piece of the action when their work appreciates in value years down the line. For the galleries and dealers, however, this introduces significant new administrative overhead and compliance risk. They now have to track every qualifying piece, calculate the fee, and manage the paperwork, which means more time spent on compliance and less on selling art.

Non-Waivable and Triple Damages

One of the most striking parts of this bill is the enforcement mechanism. The artist cannot sell, assign, or waive this royalty right—it’s attached to the work for the entire duration of the copyright. If an Art Market Professional fails to pay the royalty on time, the collecting society can sue. If the collecting society fails to pay the artist correctly, the artist can sue. In both cases, the penalty is stiff: the wronged party can recover three times the royalty amount (triple damages) plus attorney fees. This heavy penalty is designed to ensure compliance, but it also raises the stakes for every resale transaction, potentially increasing the legal friction and transaction costs in the art market.

Who Gets the Money When the Artist is Gone?

This royalty right is designed to last, extending to the artist’s estate. The bill lays out clear rules for succession: the royalty passes to the surviving spouse and children/grandchildren. If the collecting society can’t track down the artist or their successor after three years of trying, the unclaimed money doesn't just vanish. It gets sent to the Copyright Office to fund programs supporting U.S. artists. This provision ensures that the fees collected always serve the broader arts community, even if the individual artist can’t be located.

Clearing Up the Copyright Clutter

On a technical note, the bill also simplifies things for visual artists by removing the requirement to use a formal copyright notice (the little © symbol) on their work. While this doesn't change the underlying copyright protection, it means artists don't have to worry about the specific placement and format of the notice on paintings, sculptures, or photographs. It’s a small procedural change that acknowledges how copyright works in the digital age, where protection is automatic regardless of the symbol.