IRS to review ticket reseller data for taxable income.
The IRS Cracks Down on Ticket Resellers
The IRS is tightening its grip on ticket resellers, requiring sellers on platforms like StubHub and Ticketmaster to provide data if they sell more than $600 worth of event tickets. This new rule, implemented under the American Rescue Plan, aims to ensure that resellers pay taxes on their profits.
Previously, the IRS only monitored reselling data for sellers with over 200 transactions and profits exceeding $20,000. However, the threshold has now been lowered to match that of gig work, such as DoorDash and Uber. This means that even if a reseller completes just a few transactions, they will still be subject to reporting.
Under the new regulations, ticket resellers who meet the $600 threshold will need to fill out a 1099-K form. The IRS will then determine which resellers made taxable profits and which ones sold tickets at a loss. Unfortunately, those who sold tickets at a loss will not be able to deduct that loss.
Impact on Ticket Buyers
This crackdown on ticket resellers has implications for ticket buyers as well. Research shows that fans of popular artists like Taylor Swift spend an average of $1,300 to attend their concerts. With ticketing platforms hosting sales for various artists, this new IRS rule aims to ensure fairness and transparency in the ticket resale market.
While the tax change was initially scheduled for 2022, the IRS has decided to implement it this year. However, there are efforts to restore the old 1099-K threshold of $20,000 through a bill in the House Ways and Means Committee. If successful, this change would also apply to gig work.
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