At what point and how should I change the license/Copyright notice when I create a derivative?

Question

If I take a piece of software that is licensed as MIT (quoted at the end), and use it as a scaffold to create for my own thing, do I need to keep including the old license perpetually? This would seem ridiculous (although the law may see it differently), as I could potentially change (in actual meaning, rather than just rewriting the same logic but with different terms) every line of code and it would cease to have anything to do with the original author.

If I am correct, than at what point does the old author cease to retain copyright/the license ceases to hold?

In either case, at some points I would have made enough changes to warrant copyrighting them as well. How does one indicate which portions are under copyright by the old author and which are under mine?

I am interested mainly in answers from the perspective of US/common law. I understand that not all of these questions might have been tested in court, so a philosophical answer would suffice.

As a concrete example regarding which to test/explain, I would propose the "software" to be a style sheet for website. These are composed of relatively similar statements describing how different elements should look/behave (i.e. font size, font color, placement, etc., so if two people were to style the same element, there is a high probability that they would get at least some of the statements to coincide).

Finally, bonus points for explaining the relevant parts with regards to GPL(v2). I understand that it works differently as the license is supposed to be infectious, but copyright question still remains.

The license:

The MIT License (MIT)

Copyright (c) <year> <copyright holders>

Permission is hereby granted, free of charge, to any person obtaining a copy
of this software and associated documentation files (the "Software"), to deal
in the Software without restriction, including without limitation the rights
to use, copy, modify, merge, publish, distribute, sublicense, and/or sell
copies of the Software, and to permit persons to whom the Software is
furnished to do so, subject to the following conditions:

The above copyright notice and this permission notice shall be included in
all copies or substantial portions of the Software.

THE SOFTWARE IS PROVIDED "AS IS", WITHOUT WARRANTY OF ANY KIND, EXPRESS OR
IMPLIED, INCLUDING BUT NOT LIMITED TO THE WARRANTIES OF MERCHANTABILITY,
FITNESS FOR A PARTICULAR PURPOSE AND NONINFRINGEMENT. IN NO EVENT SHALL THE
AUTHORS OR COPYRIGHT HOLDERS BE LIABLE FOR ANY CLAIM, DAMAGES OR OTHER
LIABILITY, WHETHER IN AN ACTION OF CONTRACT, TORT OR OTHERWISE, ARISING FROM,
OUT OF OR IN CONNECTION WITH THE SOFTWARE OR THE USE OR OTHER DEALINGS IN
THE SOFTWARE.

Answer 1

See https://en.wikipedia.org/wiki/Derivative_work

... at what point does the old author cease to retain copyright/the license ceases to hold?

See 17 U.S.C. § 103(b) as an example of domestic law:

The copyright in a compilation or derivative work extends only to the material contributed by the author of such work, as distinguished from the preexisting material employed in the work, and does not imply any exclusive right in the preexisting material.

When there the work ceases to be derivative i.e. when there is none of the original material left in the work.

How does one indicate which portions are under copyright by the old author and which are under mine?

Under the terms of the MIT licence, you can claim copyright on your work but you are required to grant a licence to anyone and everyone on the same terms as the MIT licence so there is little point to doing so. Adding your name to the Copyright line will give you the right of attribution.

If you want to indicate which points are yours, you can pepper the code with comments indicating this but so long as the fact that this is a joint work of you and the original author is noted then it is not necessary. If someone really cares whose is which, they can refer back to the original.

Answer 2

You could potentially change every single line of code, and do it in such a way that every line of code is your own, and not derived from the existing line. Once you've done that, it is not a derived work anymore.

Until you do that, for real, and not just potentially, and not just transforming the existing code, the original author or authors are copyright holders.