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IRS Legislation Targets High-Earning Concert Ticket Resellers



IRS Legislation Targets High-Earning Concert Ticket Resellers

New IRS Reporting Requirements for Individual Ticket Resales

IRS Legislation Targets High-Earning Concert Ticket Resellers. The IRS has implemented fresh regulations designed to curb the activities of ticket scalpers who profit substantially from reselling concert tickets, particularly for highly sought-after events featuring artists like Beyoncé and Taylor Swift. Under this IRS legislation, companies such as Ticketmaster and StubHub now face an obligation to report customers who have sold concert tickets exceeding a total value of $600 in the year 2023.

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This represents a significant change from the previous requirement, where companies were only required to issue a 1099-K form to users who had earned more than $20,000 through 200 or more transactions within a year.

Impact of the IRS Reporting Rules on Ticket Resales

In a press release, the IRS clarified, “Payment apps and online marketplaces are mandated to file a Form 1099-K if the gross payments for goods and services exceed $600. This $600 reporting threshold has been in effect since the tax year 2023, and there have been no alterations to what qualifies as income or how taxes are calculated.”

This updated law, part of the American Rescue Plan Act, imposes tax obligations on individuals profiting from ticket resales.

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Addressing Fan Frustration and High Resale Prices

This legislative development comes in response to widespread fan frustration over the rapid acquisition of tickets by scalpers, leading to exorbitant resale prices for concerts featuring artists like Beyoncé, Taylor Swift, Drake, and 21 Savage. For instance, Swift’s tickets on StubHub averaged an astonishing $1,095, while Beyoncé’s reached up to $900. Similarly, tickets for Drake and 21 Savage’s “It’s All A Blur” tour soared past $800 in resale value.

Taylor Swift’s tour, in particular, drew considerable attention to the issue of high resale prices. Fans encountered difficulties with Ticketmaster’s website during the presale, which hindered their ability to purchase tickets. Once resolved, the only available tickets were expensive resale options. Expressing her frustration on Instagram, Swift said, “I’m not going to make excuses for anyone because we asked them, multiple times, if they could handle this kind of demand and we were assured they could.”

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Ticketmaster attributed the issue to the activities of automated bots and implemented a tiered ticket purchase system for the Renaissance tour. Additionally, due to the rapid sellout of many shows, more tour dates were added to accommodate the overwhelming demand. Similarly, Travis Scott faced ticket sellouts for his “Circus Maximus Tour” and responded by adding 11 new tour dates, including second performances in cities like Dallas and Atlanta.

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