Stuart A. Bronstein
Guest
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 Posted:
Fri Oct 21, 2005 1:37 pm Post subject:
Re: Patent Assignment Payment |
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Victor Roberts <xxx@lighting-research.com> wrote:
| Quote: | I'm the sole employee of my C Corp. I just assigned the
patent application for an invention to the corporation for
the nominal sum of $1.00. The last time I did this I worked
for a major corporation and assigned all my intentions to
them, but I don't remember how the assignment payment was
treated.
I assume this $1.00 is normal income and is subject to
federal and state income tax AND Social Security and
Medicare tax. Is this correct?
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You could have just transferred it to the corporation
in exchange for stock. As long as you own 80% of the
corporation's stock after the transaction, the
transaction isn't recognized for tax purposes.
If you transferred the patent application for some stock
and $1, the cash is fully taxable. But it's not wages
so I don't think it should be subject to social security
and similar taxes.
Stu
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