Co-authoring and Royalty Splitting

Co-Authoring and Royalty Splitting Agreements for Self-Published Authors: A Comprehensive Guide

Co-authoring has become an increasingly common practice in the self-publishing world. Whether for fiction or nonfiction, teaming up with another writer can amplify productivity, blend creative voices, and expand a book’s reach. However, with collaboration comes complexity—particularly when it comes to sharing ownership and dividing profits. This is where co-authoring and royalty splitting agreements come into play.

Understanding and formalizing these agreements is crucial. A poorly constructed agreement—or worse, no agreement at all—can lead to disputes, miscommunication, and loss of revenue. This article explains what royalty splitting is, how co-authoring contracts work, what they should contain, and how authors can navigate these agreements professionally, even without a lawyer.

What Is Royalty Splitting?

Royalty splitting refers to the formal arrangement between two or more parties to divide the earnings from a creative work based on predetermined terms. In the context of books, it means each co-author receives a specific percentage of the royalties generated from book sales, licensing, or subsidiary rights like audiobooks or translations.

This concept can also extend to collaborations involving illustrators, editors, or marketers, especially in children’s books or multimedia works. But most often, royalty splitting refers to the division between two or more co-authors who have jointly written a book.

How Royalty Splitting Works in Practice

Most self-publishing platforms do not automatically offer native royalty splitting features. One notable exception is Draft2Digital, which offers a “Payment Splitting” feature for authors distributing through their platform. This feature allows authors to set the percentage share for each collaborator, and Draft2Digital automatically distributes the royalties accordingly. You can read more about that feature here: https://www.draft2digital.com/blog/introducing-payment-splitting/.

On platforms like Amazon’s Kindle Direct Publishing (KDP), authors must manually divide royalties. Typically, one author receives the full payment into their account and is responsible for paying the co-author their share, often monthly or quarterly. This requires trust and detailed financial tracking.

The Role of the Co-Authoring Agreement

A co-authoring agreement is a legal contract that outlines the terms of the collaboration. It establishes ownership rights, revenue sharing, division of responsibilities, and procedures for dispute resolution or dissolution of the partnership.

These agreements can be formalized through:

• A general partnership agreement

• A joint venture agreement

• A work-for-hire contract (less common in true co-authoring)

• An LLC operating agreement (if authors form an LLC together)

Without such an agreement, copyright law assumes that co-authors jointly own the copyright and must share all royalties equally—even if one person wrote 90 percent of the manuscript. This default rule can be problematic and almost never reflects the intentions or labor balance in modern co-authoring projects.

Types of Co-Authoring and Royalty Splitting Arrangements

There are several models of co-authoring agreements based on the nature of the collaboration:

Equal Partnership

In an equal partnership, authors contribute relatively equal time and creative input and split royalties evenly (50/50 for two authors). This model works well when both parties write alternating chapters, co-develop the story, or revise the manuscript together.

Proportional Contribution

When one author contributes significantly more content, time, or intellectual property, the royalty split may reflect those contributions—such as 70/30 or 60/40. This model is especially common when one author is more experienced, brings an established audience, or acts as the project manager.

Work-for-Hire

Occasionally, a lead author hires a co-writer or ghostwriter on a flat fee or royalty-share basis. In these cases, the hired party may receive a one-time payment, a royalty percentage, or both. Unless otherwise specified, they do not retain copyright ownership.

Limited Duration Royalty Share

This model grants the co-author a share of royalties for a fixed number of years. Afterward, the primary author may regain full control. This model is rare but sometimes used when one partner offers short-term services, such as developmental editing.

Joint Ownership via LLC

Some co-authors create a limited liability company (LLC) to publish their work. The LLC then owns the copyright, and members (the authors) receive profits based on the LLC’s operating agreement. This structure offers liability protection and is ideal for long-term partnerships.

Essential Clauses in a Co-Authoring Agreement

A strong co-authoring agreement should cover the following:

1. Ownership and Copyright

The agreement should specify that the co-authors are joint copyright holders or define ownership percentages. The U.S. Copyright Office generally assumes joint copyright unless stated otherwise.

2. Scope of the Collaboration

Define the project (e.g., one book, a series, or all works under a pen name). If you are writing a single novel, the scope should say so clearly.

3. Division of Responsibilities

Clarify who does what—writing, editing, marketing, publishing, platform management, or financial tracking. This prevents misunderstandings down the road.

4. Revenue Splitting

Specify the royalty split in percentages. This clause should include sales income, licensing deals, audiobook adaptations, translations, film/TV rights, and other revenue streams.

5. Expenses

State how publishing and marketing expenses will be handled. For example, will both authors contribute equally to cover editing, cover design, and ads?

6. Accounting and Reporting

Determine how often the managing author will report earnings and send payments. Monthly or quarterly are common schedules.

7. Pen Names and Branding

If publishing under a shared pseudonym, state who controls the name and what happens if one party exits the agreement.

8. Dispute Resolution

Outline a process for resolving disagreements—often through mediation or arbitration before litigation.

9. Termination and Exit Plan

This section explains what happens if one party wants to leave the project. Can they republish the book solo? Do they retain partial royalties? Are they required to sell or transfer their share?

Example Clause: Termination

“If one party wishes to exit the agreement, the remaining author shall have the right of first refusal to purchase the exiting party’s interest, valued at 12 months of average net royalties. If both parties agree to dissolve the collaboration, the book may be unpublished or sold to a third party.”

How to Create a Co-Authoring Agreement Without a Lawyer

Though legal assistance is always preferable, many indie authors create their own agreements using templates or online tools. Here are a few ways to create your own contract:

Use Template Services

Websites like LegalZoom (https://www.legalzoom.com/) or Rocket Lawyer (https://www.rocketlawyer.com/) offer templates for partnership agreements and contracts. Tailor these documents to fit the co-authoring context.

DIY with Plain Language

Authors can also draft a simple agreement in a Word document or Google Doc. As long as the terms are clear and both parties sign, the agreement is legally binding in most jurisdictions.

Key Tips:

• Date the document

• Include both parties’ legal names and addresses

• Avoid vague language

• Add electronic signatures via DocuSign or other tools for authenticity

Signing Tools

Free tools such as HelloSign (https://www.hellosign.com/) or SignWell (https://www.signwell.com/) let you upload and sign documents electronically with a time-stamped digital signature.

What Authors Should Watch Out For

There are a few red flags to avoid when entering into a co-authoring agreement:

Vague Ownership Language

Avoid terms like “we’ll figure it out later” or “we’ll split everything fairly.” These phrases are open to interpretation and unenforceable.

One-Sided Control

Be wary of agreements that give one author full control over publishing, financials, or marketing decisions without transparency.

Lack of Exit Plan

If the contract doesn’t define how to exit the relationship, disputes may arise. An exit clause is one of the most crucial parts of the agreement.

No Royalty Tracking

If one author receives all payments and is responsible for distribution, insist on clear financial tracking—ideally with monthly reports and screenshots of dashboards.

How to Exit a Co-Authoring Agreement Without a Lawyer

Exiting a collaboration can be sensitive, especially if relationships have soured. However, it is possible to dissolve a co-authoring agreement without hiring legal counsel.

Step 1: Review the Original Agreement

Begin by reading the contract carefully. Look for any termination clauses or buyout provisions. Note deadlines, notification requirements, and consequences for exit.

Step 2: Communicate in Writing

Contact the co-author in writing and express your intention to end the collaboration. Stay professional and calm. State the reasons clearly and refer to the agreement’s termination clauses.

Step 3: Negotiate Terms

If the agreement lacks an exit plan, suggest fair terms for rights and royalty allocation going forward. For example, one author might agree to forfeit future royalties in exchange for removing their name or rights.

Step 4: Formalize the Termination

Write a termination agreement stating that both parties have agreed to dissolve the original contract. Sign and date the document. This document may include:

• Who retains the rights to the book

• Who receives future royalties, if any

• What happens to the book listing (e.g., unpublish, relaunch, rename)

Step 5: Update Distribution Platforms

If both authors had access to publishing platforms, remove the exiting author’s access or control. This includes Amazon KDP, Draft2Digital, IngramSpark, or wherever the book is listed.

Conclusion

Co-authoring and royalty splitting agreements are powerful tools for indie authors seeking to collaborate effectively. Whether you’re writing a single book or launching a long-term partnership, a well-crafted agreement prevents misunderstandings and protects both parties.

By understanding how royalties are split, what a contract should contain, and how to exit respectfully, authors can focus on their craft rather than courtroom drama. In a world where self-publishing is booming and collaboration is key, these agreements offer structure, trust, and peace of mind.

For those unsure where to begin, consider starting with Draft2Digital’s royalty split platform or adapting a legal template tailored to your needs. Always prioritize clarity, fairness, and documentation—your future self will thank you.

If you'd like, I can also generate a sample co-authoring agreement template tailored to your project. Let me know.