How Do I Report Income from a Copyright on a 1099 Form?

Individuals who earn income from a copyright often report their royalties on a Form 1099-MISC. File the form for each individual that you paid $10 or more in royalties during the tax year. Check first whether you need to report royalty payments as business revenue or instead as investment income. You will probably classify a payment as investment income if your job or your business does not overlap with the royalty payment. Report that payment type on the Schedule E (Form 1040), Supplemental Income and Loss.

Copyright generally falls under business income. Your business most likely owns or created the specific property that generates your reportable royalty payment. The property can range from a graphic to software to any other copyrighted content. Another form you must report that type of royalty on is the Schedule C (Form 1040), Profit or Loss From Business.

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