I have worked with some former authors and musicians who receive some form of royalties and “trailing income” from their past artistic works. Whether that occasional student of mid-20th Century Literature purchases a book from 1964 for his thesis, or CBS FM decides to play a song from 1982 (yes, the “Oldies” radio stations are now playing the songs you made out to in the backseat of your mom’s Dodge Minivan), someone somewhere is receiving a royalty payment.
Copyrights, patents and trademarks tend to have long royalty periods (patents tend to vary the most), which you may think is good. However, the problem is that certain forms of intellectual property, such as copyrights, can continue for long after your passing, but quickly fizzle-out as your target crowd ages, gets senile, dies, or realizes they have moved on from your old writing or music styles. But the rare purchaser does ultimately fund your coffers…for a few pennies.
I once watched a Seinfeld episode (speak of being an oldie myself) where Jerry was getting a ridiculously-small check every month because he had a 2-second appearance in some Japanese television show’s opening credits; cashing these 2 cent checks was more of a pain than it was worth, hilarity ensued (kind of – it was 1990s humor), and everyone’s life went back to their mundane chaos. The same thing happens where my clients are receiving mom or dad’s continuing-royalties for a few hundred bucks a year, so they have to wait for decades to close mom or dad’s estate.
When your post-mortem royalties to family members are actually worth them going to the bank to deposit the checks, make sure to have your trust own the piece of intellectual property: Unlike an estate created by a Will, a Trust has a long-term lifespan that has no court supervision. You will also be able to name successor Trustees if the funds are substantial and last a long time, whereas you would need to petition the court to name a successor Executor if your named choices pass away.
Also, Jerry should have asked the show to make automatic deposits to his trust account, but then the episode would have been less-funny (or more-funny, depending on your opinion of 1990’s humor)…
