Local Journalism Act Offers Tax Credits Up to $250 for Newspaper Subscriptions and Subsidizes Reporter Wages for 5 Years

This bill, the Local Journalism Sustainability Act, is essentially a five-year federal subsidy program designed to prop up local newsrooms using the tax code. It introduces three distinct tax credits aimed at individuals, publishers, and small businesses, all centered around supporting local newspapers, radio, and TV.

The Subscription Tax Break: Saving You Up to $250

The most direct impact for individuals is a new federal income tax credit for local newspaper subscriptions. If you pay for a print or digital subscription to a qualifying local paper, you can claim a credit against your taxes. In the first year this law is active, you can claim 80% of your subscription costs. After that, it drops to 50%.

There’s a hard cap, though: the maximum credit you can claim in a year is $250. So, if you spend $300 on local papers in the first year, you’d get 80% of that back, or $240. If you spend $500, you’d still be capped at $250. This benefit is set to expire after five years.

To qualify, the publication must primarily focus on original local news, employ at least one local news journalist who lives in the community, and the publishing company must have fewer than 750 total employees. This definition helps ensure the money goes to genuinely local operations, not just regional bureaus of massive national chains. This section also allows non-profit publishers to let donors treat their contributions like subscription payments for the purpose of claiming this credit, which is an interesting twist on charitable giving rules.

Publisher Payroll Subsidy: 50% Off Reporter Wages

For local newspaper publishers, the bill creates a significant payroll tax credit designed to offset the cost of employing journalists. This credit applies against the employer’s share of Social Security taxes and is based on the wages paid to “local news journalists”—defined as anyone working at least 100 hours for the publication in a quarter.

In the first year, publishers can claim a credit equal to 50% of a journalist’s wages, dropping to 30% in subsequent years. The credit is capped at the first $12,500 in wages paid to any single journalist per quarter. Crucially, if the credit exceeds the publisher's total employment tax liability, the government will refund the difference. This means it’s a direct, refundable subsidy aimed at keeping reporting jobs alive.

Because this credit reduces the amount of Social Security tax collected, the bill explicitly mandates that the Treasury must transfer appropriations to the Social Security Trust Funds to cover the shortfall. This ensures the trust funds aren't inadvertently depleted by this new tax break, transferring the cost directly to the general budget.

Small Business Ad Credit: Encouraging Local Spend

Finally, the Act offers a tax break for small businesses that advertise locally. If your business has fewer than 50 full-time employees, you can claim the Local Media Advertising Credit for money spent advertising in local newspapers, or on local radio or TV stations.

Like the subscription credit, the rate is highest in the first year: 80% of qualified advertising expenses, capped at a maximum credit of $5,000. After year one, the rate drops to 50% with a lower cap of $2,500. This provision is designed to channel small business ad dollars back into local media outlets, which often struggle against large digital platforms. Businesses must choose between taking this credit or taking the standard business deduction for those advertising expenses—no double-dipping allowed. Like the other sections, this credit sunsets after five years.