If you
are/were in the business of being a
writer and writing books during the tax year, then you report your income
and expenses on Schedule C. As long as
you are actively pursuing your writing business, your income (including
royalties for past works) is reported on Schedule C.
Once you
are no longer actively writing, but you are still collecting royalties for your
past works, your royalties will then be reported on Schedule E.
If you are currently in the
business of writing, use these steps to go to the section of your return to
enter your business income and expenses
on Schedule C:
-
On the top row of the
TurboTax online screen, click on Search (or for CD/downloaded TurboTax
locate the search box in the upper right corner)
-
This opens a box where you
can type in “business income, self-employed” (be sure to enter exactly
as shown here) and click the magnifying glass (or for CD/downloaded
TurboTax, click Find)
-
The search results will
give you an option to “Jump to business income, self-employed”
-
Click on the blue “Jump
to business income, self-employed” link and enter your information
If you are no longer in the business of writing and you only receive a royalty, then
it will be reported in the Rental
Properties and Royalties section of TurboTax. Use the following steps to go directly to
that section of your return:
- On the top row of the
TurboTax online screen, click on Search (or for CD/downloaded TurboTax
locate the search box in the upper right corner)
- This opens a box where you
can type in “royalties” (be sure to enter exactly as shown here) and
click the magnifying glass (or for CD/downloaded TurboTax, click Find)
- The search results will
give you an option to “Jump to royalties”
- Click on the blue “Jump
to royalties” link
Skip the first question or so because they will pertain to rental
properties and not royalties. You will
come to a screen titled, “Is This a
Rental Property or Royalty?” where you can choose Royalty. You will need to
enter a short description for the type of royalty and include an address for
the royalty. Use your own address if the
royalty is not associated with an actual property address (such as with a
property lease or mineral rights).
Continue moving forward until you get to a summary page for the
royalty. Here you can select Start or Update beside Royalty Income
to enter the income amount.
