Page 28 - IRS - Owning a Business

Taxable and Nontaxable Income (7/7)

Royalties, Virtual Currencies, Bartering

Royalties
Royalties from copyrights, patents, and oil, gas and mineral properties
are taxable as ordinary income.
You generally report royalties in Part I of Schedule E (Form 1040 or
Form 1040-SR), Supplemental Income and Loss. However, if you hold
an operating oil, gas, or mineral interest or are in business as a self-
employed writer, inventor, artist, etc., report your income and
expenses on Schedule C.

Virtual Currencies
The sale or other exchange of virtual currencies, or the use of virtual
currencies to pay for goods or services, or holding virtual currencies as
an investment, generally has tax consequences that could result in tax
liability. This guidance applies to individuals and businesses that
7 use virtual currencies.

Bartering
Bartering is the exchange of goods or services. Usually there's no
exchange of cash. An example of bartering is a plumber exchanging
plumbing services for the dental services of a dentist. Bartering doesn't
include arrangements that provide solely for the informal exchange of
similar services on a noncommercial basis (for example, a babysitting
cooperative run by neighborhood parents). You must include in your
income, at the time received, the fair market value of property or
services you receive in bartering.
https://lentcpa.com