In the same way, you can leave your house, car, and other personal belongings to whomever you want, musicians too can pass on their royalties once they’re gone.
However, a valid will is required to make it happen upon your death. You should specifically state the beneficiary of royalties to ensure your chosen organization or person gets it once you’re gone.
It is important to sit down with your lawyer while drafting the will to make sure that you’re clear about what you’re leaving. Also, to make everything clear about your assets and wealth.
Let’s dig deeper as to how exactly musicians pass on their royalties once they’re gone.
Don’t stop reading!
What are Music Royalties?
Music royalties are compensation received by musicians in exchange for licenses used for their recorded music.
These are usually paid by TV channels, radio stations, streaming platforms, and beyond. Sometimes users pay out the royalties directly to the rights holder.
There are different types of royalties and even the same type of royalty can be paid differently which makes such a topic somewhat complicated.
The rates for each type of music royalty vary and the payment processing in every country is different too.
For a better view, here are some types of music royalties along with their brief description:
|Types of Royalties||Description|
|Streaming Royalties||Streaming royalties are primarily monetized through selling records.|
|Neighboring Rights (and Royalties)||Performing artists and their labels are paid when their recorded music is used in some ancillary activities.|
|Digital Performance Royalties||Rights holders are paid depending on how often their music is played.|
|Sync Licensing Fees||Sync licensing fees are paid out when an artist’s recorded music is synced to ads, movies, TV shows, and other content.|
|Public Performance Royalties||These are royalties to be collected when recorded music is used or played in a commercial environment.|
|Mechanical Royalties||Mechanical royalties are paid when a copyrighted composition is distributed digitally or physically.|
As you can see, royalties are quite an extreme topic to discuss. For that reason, musicians should consult a music lawyer to deal with issues that surround the music industry.
Who gets royalties when a musician dies?
Generally speaking, the living spouse or surviving children inherit the royalties of a deceased musician. However, it depends on what is written in the valid will.
In some cases, a chosen organization or institution gets royalty rights.
Music royalties are treated like any other intangible asset owned jointly, held in trust, or transferred by gift or at death, and so on.
Royalties are paid for 70 years since the musician’s death. That is why the musician’s beneficiary can live off on royalty fees their entire lives.
Failing to settle who gets your music royalty can potentially become an issue after the musician’s death.
For instance, there is a legal battle on who gets the music fortune of the famous superstar and “Purple Rain” Prince. His sudden death complicates not only estate settlement but also his music earnings.
As a result, one-third of his assets are being controlled by parties who are not related to him.
How are royalties split between band members?
Royalties can be split evenly between band members. Anyone involved in the creation of music is considered an author and royalties should be split in a manner that reflects everyone’s contribution.
At this point, a music lawyer can help deal with splitting the royalties between band members to ensure everyone gets a fair share.
Besides, a music lawyer can also help make sense of the bonuses and dividends accumulated from participating life insurance policy if you have any.
But what is a participating life insurance policy?
It is a type of insurance policy that allows the policyholder to share the profits of an insurance company. The profits are shared in the form of bonuses and dividends, also known as a with-profit policy.
If you’re a musician who wants to invest big in insurance policies, the participating insurance life policy is worth it!
The process of bequeathing music royalties to beneficiaries can be quite overwhelming. For that reason, getting professional help is necessary to ensure things are done correctly.
There are different types of royalties for music and each one of them is paid out differently depending on your location.
It is worth digger deeper into this to give you an idea of how things work or how you’ll get paid as a beneficiary.
In most cases, the living spouse and children get the royalty rights for music after a musician passed away. They will receive the royalty fees for the next 70 years!
Most importantly, a valid will stating the beneficiary of royalties is needed to make sure a musician is leaving his music inheritance to the right person or institution.
For that reason, you need the lawyer’s help!