Records / Laws and rulings

Treas. Reg. 1.861-18(f)(2)-(3): a copy that is not truly sold is a lease, and a delete-after-a-period rule is a lease (26 CFR 1.861-18(f)(2), (f)(3))

A term-limited licence where the buyer must delete the data after a period is treated like a lease, so the fee is a royalty. A perpetual copy that the buyer owns is a sale of a copy, which is a different category.

Dated 18 Oct 2026Source checked 18 Oct 2026Basis: primary text

In the source's own words
“A transfer of a copyrighted article that does not constitute a sale or exchange because insufficient benefits and burdens of ownership of the copyrighted article have been transferred, such that a person other than the transferee is properly treated as the owner of the copyrighted article, will be classified as a lease. ... Income derived from leasing a copyrighted article will be sourced under section 861(a)(4) or 862(a)(4), as appropriate. ... a transaction in which a person acquires a copy of digital content on a disk subject to a requirement that the disk be destroyed after a specified period is generally the equivalent of a transaction subject to a requirement that the disk be returned after such period.”
Figures it counts in

It is shown on its own, not counted into a figure.

Treas. Reg. 1.861-18(f)(2)-(3): a copy that is not truly sold is a lease, and a… | AIData.Broker