Charlotte Foster


Why Bruce Springsteen decided to sell his music rights

Why Bruce Springsteen decided to sell his music rights

In one of the biggest music rights acquisition deals, Bruce Springsteen has sold his entire music catalogue to Sony Music Entertainment for a reported $500 million. 

The deal included both the Boss’ recording and publishing assets, leaving many asking why the deal was brokered in the first place. 

With many musicians opting to sell their song rights for a hefty price, there are many factors that make catalogue sales an appealing option.

The money

For Bruce Springsteen, the money involved in the sale is one aspect that is difficult to turn down. 

Especially when the $500 million pay cheque is reportedly 30 times the annual royalty payments received by the 20-time Grammy winner. 

With many selling their music rights for a huge once-off compensation payment, the selling price is often a lot higher than their annual income from royalties, record sales, or touring. 

Estate planning

The Boss’ sale could also be a way to future-proof his inheritance. 

Physical assets such as cash and property are much easier to pass on to a nominated heir than a complex basket of music rights that span several decades. 

Others have been entangled in lengthy legal battles for music rights of a deceased artist, namely James Brown and Sonny Bono, with music estates being the hottest commodity for some to fight over. 

Tax planning

As outlined by Forbes, Springsteen’s sale could have been associated with potential tax benefits. 

In layman's terms, the federal capital gain tax rate in the US is currently at 20%, but runs the risk of being hiked to 43.4% for those who earn more than $1 million in a proposal by The White House. 

Because of this and other possible tax jumps, as well as the fact that royalties are already taxed as “ordinary income”, Springsteen will receive more money in his pocket after one huge pay out, rather than opt to cash in his royalties annually. 

Image credits: Getty Images 

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