The Law Office of Michael P. Coghlan offers educational seminars for clients as well as the community. Please check back for upcoming events.
DeKalb Chamber members probably own valuable Intellectual Property (IP) but don’t recognize it. The trick is to identify it, package it, and sell it. DeKalb’s Joseph Glidden, Cindy Crawford, and Robert’s family did it. You can too.
Let’s look under the hood to see the component parts of this money-making vehicle. As you walk onto the IP car lot you see different makes and models to you to Royalty Income (Schedule C or E of your tax return). IP vehicles include trademarks, patents, copyrights, trade secrets, business methods or a combination of these.
“But I’m a busy retailer or service provider,” you say! “I don’t have time for this.”
Okay. Let’s look at it another way. When do you want to retire? Selling (licensing, monetizing) your IP can provide passive income during your retirement. To start, I usually recommend a) identifying YOUR interests, b) no loans, c) low overhead, and d) no business partners. Later you can call DeKalb companies like SunDogIT.com for IT and eworldlinx.com for web hosting.
Let’s look at a real-life example. Sofia Mattson is a 2017 graduate of DeKalb High School. She worked as a summer intern at our law office in DeKalb. Before starting college Sofia: a) purchased domain names (harpmusictherapy.com $20/yr.), b) registered her limited liability company ($50) Harp Music Therapy LLC, c) opened a business bank account (-$0-) at First National in DeKalb, d) researched the effects of harp music on Alzheimer’s patients, e) wrote and recorded ($-0- at her Dad’s recording studio) two harp music “arrangements”, f) had her pro bono lawyer sign a Non-Disclosure Agreement, g) built her own website (https://website-builders.thetop10sites.com) with a shopping cart ($28/mo.), and h) joined the Global Chamber of Commerce for the $25/year student rate. Items a) through h) are the component parts for a passive income vehicle using copyrighted music. (Read the book The Automatic Millionaire, $10 on amazon.com)
SOME ASSEMBLY REQUIRED: “So what did you do on your summer vacation, Sofia?” She identified “work” that a) piques her interests (harp music / helping people), b) fits her skills (12 years harp musician and studying for her Psy D in college), and c) serves a specific market (baby boomers who want to prevent Alzheimer’s). What’s your invention idea?
MORE IMPORTANTLY: Sofia wants her business to contribute to humanity – whether or not she makes a profit. Even if her harpmusictherapy doesn’t make money right away, Sofia’s business experience is worth far more than the cost of her website and LLC registration. As a 1st year college student Sofia owns a business and writes-off education expenses on her tax return.
SOFIA’S BUSINESS PLAN: If Sofia sells (licenses) 249,999 Alzheimer’s prevention recordings for $40 apiece, Sofia will have $10 million. (I already purchased one.) Buy now!
WHY IP? Intangible assets are generally more valuable than tangible assets. In 1982, approximately 62 percent of corporate assets in the US were physical assets. By 2000, it shrunk to 30 percent. ftp://ftp.wipo.int/pub/library/ebooks/wipopublications/wipo_pub_888_1.pdf. Investors today prefer to invest in companies with fewer physical assets. Uber doesn’t manage a fleet of cars. https://hbr.org/2016/09/investors-today-prefer-companies-with-fewer-physical-assets.
Personally I’ve had income and deductions from my IP for the last 22 years. Each aspect of our law firm (land, tax, business, and estates) deals with intellectual property assets. For example, we filed the provisional patent for Somerset Farm Sycamore luxury condos, and we also offer a Creative Works Trust for musicians.
Some of you may have attended our patent, trademark and copyright seminars when our office was located on Aberdeen Court in Sycamore. We moved to 444 E. Hillcrest Dr., DeKalb. We still offer 3-hour seminars including Non-Disclosure Agreements and IP Asset Valuation. You can call 787-0800 to reserve a seat December 8th from 1pm to 4pm, Dec. 9th from 9am to 12pm, or Dec 9 from 1pm to 4pm. The cost of $40 will pay for your IP materials.
What’s your million dollar idea?