I'm working with a client whose spouse passed away 2 years ago. Deceased spouse received royalties for copyrighted material. When spouse was alive we reported the royalties on Sch C and paid self-employment taxes. Now I'm not sure of where to report the royalties from deceased spouse and whether they are still subject to SE tax.
After spouse's death my client formed a living trust in deceased spouse's name and has been depositing royalties into the trust's bank account.
My research points to reporting on Spouse's
1040 Sch C and pay SE taxes. But I've found some contradicting material as well.Where do I report these royalties? I appreciate any help or directions on how to treat this income.