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Sch E royalty expenses are more than income received

Highlighted
Level 3
last updated ‎April 02, 2020 7:37 PM

A doctor received royalty incomes on certain products he invented.  On schedule E, his total royalty related expenses are more than royalty incomes received.  Are losses tax deductible?

And, is this type of royalty incomes passive or non-passive?

 

Thanks.

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Highlighted
Level 3
last updated ‎April 02, 2020 7:37 PM

I agree, often Royalties from professionals (especially within their line of specialty knowledge) go on Sch C - and then you can take the loss.  If you keep them on E you will be limited.

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3 Replies 3
Highlighted
Level 14
last updated ‎April 02, 2020 7:37 PM

What kind of expenses? Are you sure this goes on Schedule E and not Schedule C?


ex-AllStar
Highlighted
Level 3
last updated ‎April 02, 2020 7:37 PM

I agree, often Royalties from professionals (especially within their line of specialty knowledge) go on Sch C - and then you can take the loss.  If you keep them on E you will be limited.

View solution in original post

Highlighted
Level 3
last updated ‎April 02, 2020 7:37 PM

good suggestion.  I will ask him for more detail about this patent activity.  thanks.

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