Royalties include compensation paid to the owner for the use of property, usually copyrighted material (e.g., books, music, or art) or natural resources (e.g., minerals, oil, gravel, or timber). Royalty compensation may be expressed as a percentage of receipts from using the property or as an amount per unit produced.

To be considered royalties, payments for the use of natural resources also must be received:

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  under a formal or informal agreement whereby the owner authorizes another individual to manage and extract a product (e.g., timber or oil); and

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  in an amount that is dependent on the amount of the product actually extracted.

An honorarium is an honorary or free gift, reward, or donation usually provided gratuitously for services rendered (e.g., guest speaker), for which no compensation can be collected by law. An honorarium may include a free gift of lodging, or payment of an individual's expenses.

Royalties are earned income when they are:

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  received as part of a trade or business (see SI 00820.200 for information regarding net earnings from self-employment (NESE); or

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  received by an individual in connection with any publication of their work (e.g., publication of a manuscript, magazine article, or artwork).

For SSI income purposes, payment received for a service as described in SI 00820.450A.2. is earned income. Any other payment received in cash or in-kind connected with the service is unearned income to the extent it exceeds the individual's expenses. (See SI 00830.100B for information on expenses of obtaining income.)

1. a. 

   Verify these payments by examining documents in the individual's possession which reflect:

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     the nature of the payment;

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     the amount;

   • •

     the date(s) received; and

   • •

     the frequency of payment, if appropriate.

2. b. 

   If the individual has no such evidence in their possession, contact the source of the payment.

3. c. 

   If verification cannot be obtained by the above means, accept any evidence permitted by either SI 00820.130A or SI 00820.220.

Do not deduct any expenses of obtaining income (SI 00830.100B) from royalties or honoraria that are earned income. Such expenses are deductible from royalties/honoraria that are unearned income.

Document the information provided by the claimant/recipient or the payment source which indicates the amount, date, and, if appropriate, the frequency of the payment using EVID or aReport of Contact page and lock it, or in non-SSI Claims system situations, store the information in NDRED using the Evidence Portal (EP) or Certified Electronic Folder (CEF), as appropriate.” Once the documentation is stored and viewed for content in either eView or EP, there is no need to retain the documentation.

Input earned income royalties and honoraria as wages (SM 01005.170C and SM 01305.105), unless they are NESE (SI 00820.200).

In any suspected fraud case, obtain written verification of wages (SSA-L4201-BK) from the employer(s) (GN 04115.005).