Can a TV actor live off royalties forever?


While Wayne Knight has stayed active since the end of "Seinfeld," he could probably live off royalty checks from the successful sitcom.
While Wayne Knight has stayed active since the end of "Seinfeld," he could probably live off royalty checks from the successful sitcom.
Jason LaVeris/FilmMagic/Getty Images

Most of us assume that between "starving actor" and "celebrity," there has to be a sweet spot where thespians can find modest work and still make a respectable income. But what happens when a show is cancelled? Can an actor who played a small part on a modestly successful show move to the Caribbean and live off the television royalties forever?

Maybe. Most television actors don't live like royalty off their royalties -- but some make a decent living. "Royalties" are referred to as "residuals" in the television world. A residual is a payment an actor is due when a show plays in reruns or is sold to syndication, released on DVD or streamed online [source: SAG-AFTRA]. Calculating residuals is a tricky business, one that the TV industry leaves to its trade union, SAG-AFTRA. Much like BMI or ASCAP in the music world, SAG-AFTRA collects and pays out any residuals that are due to members.

SAG-AFTRA calculates residuals based on formulas that consider an actor's contract, time spent on the production, the production type and the market where the show appears. In general, only "principal performers" receive residuals. Background actors or "extras" (most of the zombies on "The Walking Dead," for instance) do not usually receive residuals. On the other hand, an actor who lands a small part on a show that is sold to syndication and released on DVD (think Newman on "Seinfeld") can expect residual checks, sometimes substantial ones, to roll in long after the original series is cancelled. In 2014 a judge ordered actress Lisa Kudrow to pay her former manager Scott Howard a $1.6 million cut of her "Friends" residuals [source: Toomey].

Actors who play bit roles, or even leading actors whose shows are less successful, also receive residual income, but the amounts are often small -- sometimes laughably so. Actor Jeff Cohen, who appeared in one episode of "The Facts of Life," wrote an article for Backstage magazine describing how he spent a $0.67 residual check. He took it to Maeve's Re$iduals, a pub that once traded a free drink for any SAG-AFTRA check of $1 or less [source: Cohen]. Maybe actors who can't live off their royalties can at least drink off their royalties forever?

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Sources

  • Adams, Russell. "The Shawshank Residuals." The Wall Street Journal. May 22, 2014. (Nov. 24, 2014) http://www.businessinsider.com/actors-from-shawshank-redemption-residual-pay-2014-6
  • Cieply, Michael. "Hollywood Officials Seek End to System of Paying Residuals." The New York Times. July 12, 2007. (Nov. 24, 2014) http://www.nytimes.com/2007/07/12/business/media/12hollywood-web.html?ref=media&module=Search&mabReward=relbias%3Ar%2C{%222%22%3A%22RI%3A17%22}
  • Cohen, Jeff. "Calculating SAG Residuals." Backstage.com. Nov. 14, 2008. (Nov. 27, 2014) http://www.backstage.com/news/calculating-sag-residuals/
  • Handel, Jennifer. "Residuals Revelation: Network Primetime Residuals as Chilly for SAG/AFTRA and DGA as WGA (exclusive analysis)" The Hollywood Reporter. July 23, 2011. (Nov. 24, 2014) http://www.hollywoodreporter.com/news/residuals-revelation-network-primetime-residuals-214646
  • McNary, Dave. "Actors Play Waiting Game for Residuals." Variety. June 5, 2013. (Nov. 24, 2014) http://variety.com/2013/tv/news/actors-play-waiting-game-for-residuals-1200491945/
  • SAGAFTRA.org. "Residuals FAQ." (Nov. 24, 2014) http://www.sagaftra.org/content/residuals-faq
  • Toomey, Alyssa. "Lisa Kudrow Sued by Former Manager for Friends Residuals, About $8 Million Reportedly at Stake." EOnline.com. Feb. 26, 2014. (Nov. 24, 2014) http://www.eonline.com/news/513371/lisa-kudrow-sued-by-former-manager-for-friends-residuals-about-8-million-reportedly-at-stake
  • Verrier, Richard. "Residual resentment slows Hollywood talks." The Los Angeles Times. Oct. 16, 2007. (Nov. 24, 2014) http://www.latimes.com/entertainment/news/business/newsletter/la-fi-residuals16oct16-story.html#page=1
  • Yelp. "Maeve's Residuals." (Nov. 27, 2014) http://www.yelp.com/biz/maeves-residuals-studio-city
  • Zara, Christopher. "'Seinfeld' Reruns Soak Up A Sponge-Worthy $3 Billion Since Cancellation; Co-Creators Jerry Seinfield and Larry David Cash In." International Business Times. April 4, 2013. (Nov. 27, 2014) http://www.ibtimes.com/seinfeld-reruns-soak-sponge-worthy-3-billion-cancellation-co-creators-jerry-seinfeld-larry-david

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