An inventor has a patent that he wishes to sell to a company. So far so good, IRC sec 1235 says that if an inventor sells "all substantial rights", it's treated as a capital asset and capital gains rates apply. He'd like to keep making his patented widgets, which presumably can be handled by the company granting back a license. The question is whether that disqualifies the sale for capital gains treatment. The usual advice would be to consult a Knowledgable Tax Professional. Well, he did, several in fact, and their combined advice can be summarized as "I dunno". Inventors sell their patent rights all the time, and he's surely not the first one to want such a grant back. So where's the IRS rulings, case law, etc?
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