If You Resold Taylor Swift Tickets, You Might Owe The IRS — Here's Why

As Taylor Swift’s Eras Tour takes the world by storm, Swifties everywhere are doing whatever it takes to score those coveted tickets. For many, that means turning to the resale market and paying exorbitant prices from eager sellers looking to cash in. With an average resale price of $2,183 per ticket, according to TicketIQ, the financial implications for sellers are significant, especially when juxtaposed against the original average ticket price of $253.56 reported by Pollstar.

For the 2023 tax year, you’ll only receive a 1099-K from third-party sellers like StubHub if you had over 200 transactions totaling more than $20,000. That’s a pretty high bar, meaning many casual resellers could slip under the IRS reporting radar.

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However, don’t get lulled into thinking you’re totally off the hook. The agency is just phasing in stricter reporting requirements. Come 2024, that 1099-K threshold will drop to $5,000 for tax returns filed in 2025 and beyond.

The IRS wants its cut from all those marked-up ticket sales, regardless of the reporting formalities. Even if you don’t receive paperwork specifically calling out your reselling profits, you’re still legally obligated to claim that extra income.

Tommy Lucas, a seasoned financial planner, breaks it down to CNBC — If you bought a ticket for $1,000 and sold it for $3,000, you’ve made a clear profit that the IRS will be interested in. This isn’t just advice; it’s a warning that making money off Swift’s tickets — or any tickets, for that matter — means you’re stepping into the realm of taxable income.

It doesn’t matter if you’re doing this as a one-off or as a side gig; all income needs to be reported. Yes, even if you don’t get a form in the mail from a third-party payment processor like PayPal or Venmo saying you’ve crossed a certain threshold, you’re still expected to declare your earnings. Ignoring this could lead to a headache come tax season.

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So, what’s a Swiftie reseller to do? First off, keep solid records. Whether you’re jotting down numbers in a notebook or using a spreadsheet, knowing exactly what you spent and what you earned is crucial. Without clear records, reporting your income accurately is nearly impossible.

Avoid closing accounts you’ve used for selling. It’s all about making life easier when it’s time to do the math on what you owe.

If you’re seeing dollar signs from your sales, it might be smart to set some of that cash aside for Uncle Sam or even make quarterly tax payments. This way, you won’t be caught off guard.

And here’s a pro tip: Consider a separate bank account for your resale hustle. It could simplify tracking your income and expenses, making it clearer what’s for fun and what’s for the IRS.

As exciting as scoring and selling tickets to see Taylor Swift live can be, it’s important to remember the tax implications. With a bit of organization and foresight, you can enjoy the concert and the profits without worrying about tax troubles later on.

Consulting with a financial adviser can be a crucial step in managing your finances effectively, especially when navigating the complexities of income from various sources, including the resale of high-demand concert tickets. A financial adviser can offer personalized advice for your specific financial situation, helping you develop strategies to maximize your earnings, minimize your tax liabilities and ensure that you are fully compliant with current tax laws. 

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*This information is not financial advice, and personalized guidance from a financial adviser is recommended for making well-informed decisions.

Jeannine Mancini has written about personal finance and investment for the past 13 years in a variety of publications including Zacks, The Nest and eHow. She is not a licensed financial adviser, and the content herein is for information purposes only and is not, and does not constitute or intend to constitute, investment advice or any investment service. While Mancini believes the information contained herein is reliable and derived from reliable sources, there is no representation, warranty or undertaking, stated or implied, as to the accuracy or completeness of the information.