Andrew Adler Consulting LLC

Royalty fees are often the basis of many licenses because they guarantee the fair value of the creator’s purported IP rights. The goal is to explain how accounting for royalty payments works, their tax treatments, and the structures involved. It is essential for businesses aiming to navigate licensing agreements effectively. Whether it is managing own book royalty, mining rights, franchise fees, or other related revenues, the right strategies can make a significant difference. What Are Royalty Payments? Royalty payments refer to contracts between licensors and the licensees through which owners can commercialize their inventions. They pay creators for using their products, which, in this case, are their assets. This may include art and photography and may stretch to patents and business franchises, among others. Payments are made by the licensee to the licensors under specified terms. This enables the licensees to use extra valuable assets without having an ownership claim on such u...