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Treatment of Royalties and Income from Creative Works

• Independent Works - All royalties and income obtained from the CW belong solely to the employee.
• Church/Ministry CW - All royalties and income obtained from the CW legally belong to the partner Church/Ministry unless negotiated otherwise. 
• Reliant Services CW - All royalties and income obtained from the CW legally belong to Reliant.
• Reliant Services Derivative Works - Unless negotiated otherwise with the President & CEO, or designated representative, all royalties and income obtained from a Derivative Work that was derived from an existing Reliant work legally belong to Reliant.

Treatment of Royalties and Income Received by Reliant 

Reliant Royalty Income/MTD Account

Any royalty income belonging to and received by Reliant, that is directly related to Reliant Services CW developed by an employee, will be directed as incometo the applicable Reliant MTD account for which that employee is responsible (less any administrative assessments or other financial considerations and overhead as noted in any negotiated CW agreement).

If the field employee leaves Reliant employment and there is no subsequent transfer** of CW ownership or right to use the CW, Reliant has the option to re-direct the royalty income to another Reliant ministry fund.

(**If the employee leaves Reliant employment and there will be a subsequent transfer of CW ownership or right to use the CW, please refer to the Treatment of Reliant Services Creative Works if Employee Leaves Reliant section below).

Treatment of Production Expenses for Reliant Services Creative Works

• Independent Works - All expenses related to producing CW obtained from an Independent Work are the sole responsibility of the employee and must be paid by the employee.
• Reliant Services Works - Unless negotiated otherwise with the President & CEO, or designated representative, all expenses related to producing, publishing, distributing CW that is a Reliant Work developed by an employee, will need to be paid from the applicable Reliant MTD account for which that employee is responsible.
• Reliant Services Derivative Works - Unless negotiated otherwise with the President & CEO, or designated representative, all expenses related to producing, publishing, distributing CW that is a Derivative Work developed by an employee, will need to be paid from the applicable Reliant MTD account for which that employee is responsible. (Here it is assumed that the Derivative Work was derived from an existing Reliant work and belongs legally to Reliant).

Treatment of Reliant Services Creative Work if Employee Leaves Reliant

If the employee leaves Reliant employment, Reliant may use one of several options (but is not limited to) for the treatment of any CW produced by the employee (that legally would be classified as a Reliant Services Creative Work), including the following:

1. One option is that Reliant will donate the CW to another 501(c)(3) ministry that is in harmony with Reliant's tax-exempt purposes, subject to Board approval.

2. A second option would be for Reliant to agree with the employee, to transfer the ownership rights to the employee who is leaving their employment with Reliant (if that employee desires personal ownership of the CW). Reliant is required by tax-exempt laws to first consider whether it is in keeping with its tax-exempt purposes to make such a transfer. After that decision is made by Reliant, the process would require the following steps (these are again required by tax-exempt laws under which Reliant is constrained):

• Reliant will obtain a fair market value of the CW for the rights to be transferred to the employee. This is known as the "CW FMV" or "Purchase Price". Reliant is required by law to assign its CW rights in exchange for receiving "fair market value".
• After obtaining a fair market value of the rights for the CW, this now becomes the "Purchase Price". Reliant will work with the employee/purchaser to arrange one of the following payment options for the assignment of the CW rights to the employee:

a. No cash payment. In this case, Reliant adds the amount of the Purchase Price to the employee's compensation as additional compensation. Reliant will then list the total compensation on the employee's Reliant W-2.

b. Cash payment. In this case, the employee pays Reliant the Purchase Price in a one-time cash payment.

Under either payment scenario above, the employee is responsible for all personal income and any other taxes due as a result of the purchase of the CW from Reliant

3. If during their ongoing Reliant employment, the employee desires to personally own any CW he or she produced while still working for Reliant (and Reliant agrees), they could do so under the same options listed in section 2(a) and 3(b) above.

• If the employee has already left Reliant employment, the only payment option available to him or her is the cash payment - 2(b).

Expenses Incurred: For Sections 2 and 3 above, Reliant will obtain a fair market value of the CW in consultation with legal counsel. Unless negotiated otherwise with the President & CEO, or designated representative, all expenses incurred related to valuing the CW, will need to be paid from the applicable Reliant MTD account for which that employee is responsible.

Employee Responsibility for Taxes for Independent Works

Reliant employees are personally responsible for all tax obligations relating to income generated from their Independent Works. Employees are also responsible to ensure that no Reliant resources, including work time, personnel assistance or Reliant facilities or equipment, are used for the production of materials produced outside the scope of their employment with Reliant.

If, inadvertently, an employee utilizes any Reliant funds or resources in the production of Independent Works, the employee needs to reimburse Reliant in full for the total costs incurred, and/or costs associated with the services and equipment used.

If no reimbursement is made to Reliant, such costs may be considered taxable to the employee. In such instances, there may possibly be significant tax consequences to the employee for which he or she shall be responsible.

Compliance with IRS Regulations and ECFA Standards

This policy shall be interpreted to fully comply with IRS regulations and ECFA Standards governing Creative Works, including ECFA Standard 7.9, Conflict of Interest on Royalties, which provides as follows: "An officer, director, or other principal of the organization must not receive royalties for any product that is used for fund-raising or promotional purposes by his/her own organization."

Legal Items - Copyright Notice, Registration, and Agreements

All copyright-able Reliant Works produced and/or prepared by Reliant employees, independent contractors, and volunteers within the scope of their employment or their contractual or other duties are required to contain proper copyright notices indicating that Reliant is the legal owner of the copyright. In instances where Reliant determines that the copyright of the Derivative Work can be owned by a Reliant employee (who is creating the Derivative Work outside the scope of his or her employment duties), the Reliant employee is required to specifically indicate the copyright notice of the Derivative Work and all copyright registrations, that the Derivative Works relies on underlying material that is owned by Reliant.

From time to time, Reliant may need to have its employees sign forms to assist Reliant in registering its copyrights in the Reliant Works or Derivative Works, and also may be required to assist Reliant in establishing its copyright ownership.

All employees agree that Reliant can obtain full disclosure in writing of any and all Reliant Works created by the employee at any time during the course of employment.

Reliant may request from its employees, any agreements it needs to implement this CW Policy, but the absence of such agreements does not affect Reliant's rights under this policy.

_{1 Reliant Work(s) developed or prepared by independent contractors or volunteers at Reliant's request will be considered "works made for hire" under specific guidelines set forth under United States copyright law (17 U.S.C §101 et seq.) and cases, and/or assigned to Reliant by contract or written agreement.}