RESELLING TICKETS FOR TAYLOR SWIFT'S TOUR AND OTHER POPULAR EVENTS CAN MEAN BIG MONEY. THE IRS IS AWARE

Did you luck into tickets to a popular show, like Taylor Swift's Eras Tour, only to find out you can't make the date? If you're looking to resell tickets for a profit, you'll need to include that income on your taxes.

"The profit you make is considered income and the sale should be reported on your tax return," said Mark Steber, senior vice president and chief tax information officer at Jackson Hewitt Tax Service. And there aren't any exceptions -- even if it's a part-time gig or just for fun. If it's money earned, it needs to be noted on your tax return. 

You may not receive a tax form for your profit, but you still need to report it when you file your taxes next year. 

For this year, there's a new tax reporting rule that requires personal or business accounts that receive $20,000 in payments from over 200 transactions to receive a 1099-K. But whether you receive the form or not, if it's income, the IRS needs to know about it. 

Report any profits from reselling tickets on your taxes

Anytime you make a profit from reselling goods or services, it triggers a taxable event. So, for example, if you buy Eras tickets for $1,000 and resell them for $2,000, you need to report the $1,000 profit to the IRS. 

"Whether you are paid through a third-party payment network (credit and debit and direct money transfers), with cash or checks or services you must report the money or value on the tax return," Steber added. 

This is true whether you receive a 1099 form for your profits or not. Third-party apps like TicketMaster. StubHub and even Venmo or PayPal may send you a 1099-K next year, depending on how much income you earned. Originally, the IRS planned to implement a new reporting rule that required third-party apps to issue a 1099-K whenever you earn $600 or more through the platform. However, that rule has been delayed. For this year and next tax filing season, the IRS plans to implement a $5,000 threshold. So if you make less than $5,000, you may not receive a 1099-K next year.

"You still have to report these earnings, even if you don't receive a 1099-K from the platform," Steber said. You'll report the money as self-employment income when filing your tax return.

How to report the income  

Any income you earn, including profits from concert tickets, should be included on your tax return unless there are specific exceptions for the money, said Steber. 

If you receive a 1099-K, 1099-NEC or other 1099 form, you'll report this tax form under the income section with online tax software. 

But if you don't receive a tax form and you know you profited from ticket resells, try reaching out to the payment platform and ask for the tax form. If you don't receive a tax form, you can still report the income -- just make sure the total profit is correct. Cross-check your ticket emails and payment app or bank account statements to confirm the amount. Not including this information on your taxes could mean penalties and potentially being audited

"You can be penalized for under-reported income and not paying your taxes on time," Steber said. "Additionally, you would be assessed interest on the outstanding taxes and penalties until they are paid." 

If you use peer-to-peer payment apps, the best way to keep your income separate from money you might send to family or friends is by setting up separate personal and business accounts. Steber recommends keeping any receipts (and other tax documents) for at least seven years in case there are questions later.

2024-04-23T15:15:03Z dg43tfdfdgfd