ATLANTA — After a summer of concerts - you may have heard about the Taylor Swift and Beyoncé tours - many ticket resellers are still not aware of a new tax law update that may require them to report those earnings to the IRS next year, according to Ticketmaster.
Effective starting this tax year, the IRS reporting thresholds for all e-commerce platforms were lowered.
How does this impact fans?
The new IRS threshold for business transactions is now $600 per year, replacing the previous requirement of over 200 transactions worth a total of $20,000. This law only applies to business transactions and not personal ones like splitting costs or buying gifts.
This means for fans reselling tickets, Ticketmaster must file a Form 1099-K report with the IRS when the "gross revenue received from transactions on our U.S. marketplaces meets or exceeds $600 in a calendar year per seller."
Fans who meet or exceed this amount will be provided a copy of the form and can expect to see it in the mail by January 31 of the following year.
On the form, Ticketmaster said they must inform the IRS of the gross amount of all reportable transactions of their consumers during the calendar year.
"The gross amount may include the price of the tickets resold, as well as fees and other amounts related to ticket sales, without adjustments for credits, discounts or refunds," Ticketmaster said.
What's Form 1099-K?
Form 1099-K is a report of payments you got during the year from:
- Credit, debit or stored value cards such as gift cards (payment cards)
- Payment apps or online marketplaces (third-party payment networks)
Third-party payment networks are required to file Form 1099-K with the IRS and provide a copy to you when the gross payment amount is more than $600. Form 1099-K should not report gifts or reimbursement of personal expenses you received from friends and family.
Use Form 1099-K with other tax records to help figure out and report your taxable income when you file your taxes.
Will the event organizer need to do anything?
There's no action needed by organizers, Ticketmaster said it would also notify all fans on any Ticketmaster U.S. marketplace.