It depends on how the agreement is structured.
If it’s earned income, then it’s subject to federal self employment taxes plus federal and state/local income taxes. But, if they can identify expenses paid wrt to earning that income, that’s deductible.
If it’s a royalty type payment it’s just subject to income taxes. There also might be expenses directly related to that which may be deducted against that income.
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In response to this post by EDGEMAN)
Posted: 09/08/2021 at 6:02PM