Treas. Reg. 1.861-18(f)(2)(ii): sourcing of a sold copy, and the billing-address rule for electronic delivery (26 CFR 1.861-18(f)(2)(ii))
If a data deal is a sale of a copy, it is not a royalty and follows the sale-sourcing rules, with a deemed place of sale at the buyer's billing address when the data is delivered electronically.
Dated 18 Oct 2026Source checked 18 Oct 2026Basis: primary text
In the source's own words
“Income from transactions that are classified as sales or exchanges of copyrighted articles will be sourced under section 861(a)(6), 862(a)(6), 863, or 865(a), (b), (c), or (e), as appropriate. When a copyrighted article is sold and transferred through an electronic medium, the sale is deemed to have occurred at the location of the billing address of the purchaser for purposes of § 1.861-7(c).”
Where it was read
Also read from the same source
- Treas. Reg. 1.861-18(a)-(b): what a digital content transaction is and its four categories (26 CFR 1.861-18(a)(2), (b)(1))
- Treas. Reg. 1.861-18(c): copyright rights and copyrighted articles (26 CFR 1.861-18(c)(2), (c)(3))
- Treas. Reg. 1.861-18(d)-(e): services to develop digital content, and know-how (26 CFR 1.861-18(d), (e))
- Treas. Reg. 1.861-18(f)(1): a transfer of a copyright right is a sale or a licence, and a licence is sourced as a royalty (26 CFR 1.861-18(f)(1))
- 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))
- Treas. Reg. 1.861-18(g)(1) and (i): the label on the contract does not decide, and the rule's start date (26 CFR 1.861-18(g)(1), (i)(1))
Figures it counts in
It is shown on its own, not counted into a figure.
Cited in this guide