Hatfield, what I call it doesn’t matter. What matters is the IRS regulation and the facts of the deal. To understand it better I would suggest looking at the regulation and understanding the concept outlined in it of copyright rights, and the concept that you can sell the copyright rights even though you don’t sell the copyright.
As to semantics, read paragraph (g)(1) which specifically points out that how the transaction is classified by the parties or by copyright law does not determine how this regulation classifies it.
For those interested in this whole ball of wax, I also highly recommend the examples which give a good sense of how to apply the rules of this regulation.
If you’re curious about my situation, I won’t give out specific details, but say only that my case is pretty close to example 5 which is considered the sale of a copyright right.
But keep in mind here that I’m not an attorney, nor a CPA or anything like that, and that if you or anyone else wants to pursue something like this I highly recommend doing what I did, which was to get professional advice from someone who has experience and does understand these things.
