A new IRS reporting threshold went into effect this year for transactions on third-party platforms, such as Ticketmaster or StubHub. Now, if you sold even one ticket for as little as $600 more than you paid, your ticket sale is reported. Previously the threshold was 200 transactions worth an aggregate of more than $20,000.
Where you’re hearing a lot of buzz about this are those folks who bought tickets for Taylor Swift’s Eras Tour then resold them, making a profit. It’s reported that the average price of a single ticket resold for $2,183 in the secondary market.
Even non-Swifties may be hit with Form 1099-K now, the form that reports payments and transactions from online platforms, apps or payment card processors. For example, if you’re someone who has season tickets to the Portland Timbers or Winterhawks, and regularly resells tickets, you’ll want to be aware of how to prepare by following the below steps:
- Don’t ignore the form. If this is your first time receiving a 1099-K, don’t ignore it. It’s best to anticipate it will be coming your way and look for it, holding on to it for when you gather all your tax documents. If you sold tickets on multiple platforms, you may receive various 1099-K forms.
- Keep accounts open. Don’t close accounts used for transactions as it may make record keeping more difficult. You’ll want to keep copies of your purchase receipts and your sold amount, since taxes owed will be based on your sales proceeds minus the original purchase price.
- Double-check the 1099-K. Confirm all your 1099-Ks match your transaction records, as you’ll want to avoid having to file an amended return.
- Be Prepared. If you think this may affect how much taxes you expect to owe, think about setting money aside now.
If you have more questions on how this change may affect your situation, don’t hesitate to reach out to our team. We love to translate numbers and tax laws!