Tax Considerations for Authors: Royalty Income, Self-Employment Tax, Inventory, and Sales Tax

Note: CLE credit is not offered on this program

Recording of a 110-minute CPE webinar with Q&A

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Conducted on Monday, June 5, 2023

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Course Materials

This webinar will discuss tax issues specific to authors and self-publishers of tangible and digital works. Our panel of seasoned tax professionals will provide explanations for handling sales tax, royalties, inventory, self-employment tax, and business formation for authors.

Description

Whether traditionally-published or self-published, authors have unique tax considerations. For example, taxpayers engaged in the production and resale of property are generally subject to UNICAP for income tax purposes and are required to capitalize certain costs. However, Section 263A(h)(1) adds, "Nothing in this section shall require the capitalization of any qualified creative expense." It further explains that writers, photographers, or artists are eligible for this exception. But what happens when a taxpayer changes roles and moves from author to publisher?

Further complications include classifying royalty income which could be taxed as ordinary income subject to self-employment tax or as capital gains on Schedule D for the sales of copyrights. Perhaps the most challenging is determining when and whether sales are subject to sales tax. With almost all publications sold in multiple states and a substantial number of eBook, print books, and audiobook sales, practitioners and authors need to understand when sales are subject to sales tax.

Listen as our authoritative panel of experts explain the unique tax issues for authors and their tax advisers.

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Outline

  1. Types of authors
  2. Business structures
  3. Royalties
  4. Inventory
  5. Sales Tax
  6. Deductions
  7. Self-employment taxes and Quarterly Estimated taxes
  8. Qualified Business Income

Benefits

The panel will cover these and other critical issues:

  • Choice of entity considerations for authors
  • How royalty income is taxed
  • Sales tax requirements for tangible and digital publications
  • Tracking and reporting book inventory
  • Report self-employment and quarterly estimated taxes on author income

Faculty

Kowis, Mike
Mike Kowis
Attorney
Lecture PRO Publishing

Mr. Kowis is a corporate tax attorney, college instructor, speaker, and award-winning author.

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Mathews, Joel
Joel Mathews, CPA
Partner
Turlington & Mathews

Mr. Mathews brings to TRO his federal and state tax experience and knowledge from working in both the public and...  |  Read More

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