Cornell University’s policy on the distribution of technology transfer licensing revenues provides that generally 1/3rd of net revenues are shared with Cornell faculty who are inventors or developers (“inventors”) of the licensed intellectual property. Occasionally, a Cornell inventor will desire to waive the inventor’s personal share of revenues.
The Internal Revenue Service (IRS) rules governing revenue recognition are quite complex and one of the main issues is whether or not the waived revenue is still taxable to the inventor. The amount waived by a Cornell inventor will not be reported by Cornell on IRS form 1099 as miscellaneous income to the inventor provided the inventor completes and signs a “Waiver of Personal Share of Revenue” form and submits the form to the Center for Technology Licensing (CTL) at Cornell University. Cornell also will not report the amount subject to the signed waiver as a gift or charitable contribution from the inventor. Upon receipt by CTL the waiver will be considered fully executed and not subject to amendment.
Waived revenues will be distributed by CTL. Inventors should consult with their own legal and tax advisors before signing.