Self-publishing has revolutionized the book industry, allowing authors to take control of their work, reach global audiences, and earn a steady stream of royalties. But while publishing platforms like Amazon KDP, Apple Books, and IngramSpark make it easier than ever to get your book into readers’ hands, they don’t necessarily protect your earnings.
Whether you’re an indie author selling thousands of copies or just getting started, one thing is clear: your royalties are your livelihood, and you need to protect them.
Many authors focus on writing, editing, and marketing but forget about the legal and financial safeguards that ensure their hard-earned royalties stay secure. If you want to build a sustainable publishing career, here’s what you need to do.
Contents
Secure Your Copyright & Intellectual Property
One of the biggest misconceptions in self-publishing is that once you write a book, you automatically own all rights to it. While this is true to an extent, formal copyright registration gives you legal proof of ownership.
Why Copyright Registration Matters
In the U.S., copyright protection exists the moment your book is created. However, registering it with the U.S. Copyright Office provides:
- Legal Evidence: Proof that you are the rightful owner of the work.
- Stronger Enforcement: The ability to sue for damages if someone steals or reproduces your book without permission.
- Protection Against Plagiarism: If someone tries to claim your work as their own, you have legal documentation to back your claim.
For authors publishing internationally, similar copyright protections exist in most countries. While not required, registration is a small investment that can prevent major legal headaches down the road.
Use Solid Contracts for Collaborations
Many authors collaborate with editors, cover designers, audiobook narrators, or co-writers. Without clear agreements in place, disputes over rights and royalties can arise.
Key Agreements Every Self-Publisher Should Have
- Work-for-Hire Agreements: If you hire a cover designer, make sure your contract states that you own full rights to the design.
- Co-Author Agreements: Clearly define who owns what percentage of royalties and how creative decisions are made.
- Ghostwriting Contracts: If someone else writes content for you, ensure they waive rights to royalties.
Verbal agreements aren’t enough—always have written contracts to protect yourself from future conflicts.
Know Your Publishing Platform’s Terms
Different publishing platforms have different policies on royalties, exclusivity, and payment schedules. Not understanding these terms could lead to unexpected issues, such as losing rights to your book or receiving lower royalty payments than expected.
What to Watch Out for in Publishing Contracts
- Exclusive vs. Wide Distribution: Amazon KDP Select requires exclusivity, meaning you can’t sell your e-book elsewhere for 90 days.
- Royalty Percentages: Amazon offers 70% royalties on e-books priced between $2.99-$9.99, but outside that range, royalties drop to 35%.
- Withholding Taxes: Some platforms withhold taxes if you don’t submit proper tax documentation, reducing your earnings.
Before choosing a publishing platform, read the fine print to ensure you understand the financial and legal implications.
Protect Your Royalties from Tax Surprises
Many self-published authors don’t realize that book royalties are considered taxable income. If you don’t prepare, you could face an unexpected tax bill.
How to Handle Taxes as an Author
- Set Aside a Percentage: A good rule of thumb is to save 25-30% of your earnings for taxes.
- Track Expenses: Deductible expenses include editing, cover design, advertising, and ISBN purchases.
- Pay Estimated Taxes: If you earn significant royalties, the IRS may require quarterly estimated tax payments.
Keeping detailed records of income and expenses ensures you don’t overpay—and helps avoid IRS penalties.
Consider Business Structuring for Financial Protection
If your self-publishing business is growing, it may be time to think about structuring it as a formal business entity. Many authors start as sole proprietors, but this setup doesn’t offer personal asset protection.
Some authors opt to create an LLC (Limited Liability Company) as their business grows. This can help separate personal and business finances, making it easier to track income, claim tax deductions, and safeguard personal assets in case of legal issues. While an LLC isn’t necessary for every author, those earning substantial royalties often find it to be a smart move.
Once your book is published, piracy is a real concern. Websites offering free illegal downloads of books pop up all the time, and while you can’t stop all piracy, you can take steps to minimize it.
How to Combat Book Piracy
- Set Up Google Alerts: Receive notifications if your book title appears on suspicious websites.
- Use DMCA Takedown Requests: If you find pirated copies, send a Digital Millennium Copyright Act (DMCA) takedown request to the website’s host.
- Consider Digital Rights Management (DRM): Some authors enable DRM when publishing to prevent easy file sharing.
While piracy can’t always be avoided, being proactive helps protect your royalties.
Self-publishing is an incredible opportunity for authors, but protecting your royalties requires more than just writing a great book. Securing your copyright, using proper contracts, understanding your publishing platform’s terms, managing taxes, and structuring your business wisely are all essential steps to safeguarding your earnings.
By treating your self-publishing career like a real business and putting the right legal and financial protections in place, you ensure that your hard work continues to pay off—without unnecessary risks.
