Book royalties not always considered business income

[redz7yadhjjqy8jk]

Thanks for this information, kingckat.  Were your books self-published?  I published a book through a publisher in 1998, and in recent years receive maybe $95 in royalties/year.  Not sure if I should be following your method of filling out the tax forms.  

[redz7yadhjjqy8jk]

Under Turbotax help, Schedule E:  "income from copyrights on literary, musical, and artistic works...would be considered investment royalties if you are not in the business of creating these works.". Does that mean if you are now retired but still receiving royalties?  My accountant always put my royalties from a book I wrote years earlier on a Schedule E.

[PatriciaV]

Yes, you may report these royalties on Schedule E as "investment" income, especially if you do not hold the copyright on the published works.

@redz7yadhjjqy8jk 

[mchrist212]

I wrote a book and someone has the publisher rights registered to a LLC.  Who is supposed to report the income?

[Wright1]

What do I put as the "property address" for the book I wrote in 2019? I am no longer writing books.

[DaveF1006]

If you received royalties from the book, you need to report the income as Schedule C income. if you sold the publishing rights, you will need to report that as income as well.

@mchrist212 

[DaveF1006]

To clarify, what do you mean by property address and are you still receiving royalties?

@Wright1 

[redz7yadhjjqy8jk]

There is also the Schedule E option for those no longer in the writing business, choosing the source of royalty income as royalty investment income from "intellectual property."

[redz7yadhjjqy8jk]

I put down the name of the publisher where they asked for the address.  That question is new this year and confused me.  It really is for people who receive money from actual property.

[esparks]

I would like to clarify that the IRS’ rule for royalties not being considered self-employment earnings is only in the case of an author who wrote only one book and never revises it. Otherwise, royalties for books created while the taxpayer was engaged in the business are still considered self-employment earnings reported in sch C, even if the author already retired and no longer writes books.

Ref: Tax Issues for Individuals Who Create Intellectual Property (thetaxadviser.com)

 https://weblibrary.thetaxbook.net/thetaxbook-federal-2023/page-5-19)