If you are no longer in the business of writer, you would report your royaly on Schedule E, and not on Schedule C. This will prevent self-employment tax from being calculated on the royalty income. If you are still in the business of writer, all royalties would be subject to self-employment tax.
According to IRS filing instructions for Schedule E -
Report on line 4 royalties from oil, gas, or mineral properties (not including operating interests); copyrights; and patents. Use a separate column (A, B, or C) for each royalty property.
If you received $10 or more in royalties during 2013, the payer should send you a Form 1099-MISC or similar statement by January 31, 2014, showing the amount you received. Report this amount on line 4.
If you are in business as a self-employed writer, inventor, artist, etc., report your royalty income and expenses on Schedule C or C-EZ.
