How reselling tickets impacts taxes - Do I owe on full sales amount?

What if the friend writes a letter or statement confirming the ticket prices they sold them for? Would that help at all? Or is that too easy to fake for the IRS to accept?

A statement from your friend could help establish your costs, but it's not as strong as contemporaneous documentation. It would be better than nothing, especially if supported by other evidence like text messages or emails discussing prices. As for being "too easy to fake" - the IRS isn't automatically suspicious of everything, but they do look for reasonable substantiation. If your friend has records of the original ticket prices (from their membership), that would strengthen your case considerably.

How exactly does it work with the documentation part? Like does it just make a nice PDF or something you can show the IRS? I've got a similar situation with basketball tickets I buy from my uncle.

That sounds too good to be true honestly. The IRS is pretty strict about documentation. Does it actually hold up if you get audited? Or is it just something that looks official but wouldn't actually work?

It creates a detailed transaction report that pulls together all your digital evidence. It's not just a pretty PDF - it extracts ticket prices, dates, event information, and transaction details from your emails and account history, then creates documentation that establishes your actual costs and profits. It definitely holds up for audit purposes because it's not creating fake documentation - it's organizing the real evidence you already have but might not realize is usable. In my case, it found email confirmations and transfer records that proved what I actually paid, even though the cash part wasn't directly documented. The IRS accepts reasonable reconstruction of records when original receipts aren't available.

Wait how does this actually work? They somehow get the IRS to call you faster? That doesn't seem possible since the IRS phone system is all automated.

This sounds like complete BS. Nobody can make the IRS call you faster. I spent 4 hours on hold last month and there's no way around their system. This has to be some kind of scam.

It uses a system that navigates the IRS phone menu automatically and stays on hold for you. When an agent finally picks up, it calls your phone and connects you directly to that agent. It's not magic - it's just automating the hold process so you don't have to sit there listening to the hold music for hours. The reason it works is because it can redial and navigate the menus 24/7 until it gets through. Much more efficient than manually calling and waiting yourself. It's basically like having someone else wait on hold for you until a real person answers.

This is incorrect and potentially dangerous advice. The IRS is very clear that income from reselling for profit is taxable, whether it's a full business or occasional sales. The "hobby vs. business" distinction affects which deductions you can take, not whether the income is taxable. With ticket reselling specifically, if you're buying with the intent to resell at a profit, that's not a hobby - it's a profit-seeking activity. Also, with the new reporting thresholds for online sales platforms, this activity is much more likely to be tracked than in previous years.

I guess i should clarify what I meant. If you're just selling tickets occasionally for games you originally planned to attend but then couldn't go to, and sometimes you make a small profit but other times you lose money, that's different from consistently buying tickets with the intent to resell for profit. I still think the IRS has bigger fish to fry than someone making a few hundred bucks selling tickets they couldn't use. But yes, technically any profit is supposed to be reported.

The $600 reporting threshold got delayed again. I think it's still at $20,000 for 2024 tax filing season, but yeah it'll eventually drop to $600 which will affect a ton more people. So even if you're flying under the radar now, you should probably start keeping better records.

Thanks for the info! That's a relief to hear about the delay. I definitely need to start being more organized with my records though. I've just been doing this casually but made maybe $2k profit this year from about $12k in sales.

This is really helpful advice! I'm curious about the Schedule C route though - doesn't that mean you're treating it as a business? I've only been doing this sporadically when I can't make games, not as a regular business activity. Would that still qualify for Schedule C or should I be reporting it somewhere else? Also, when you say "reasonable reconstruction" - do you have any idea what level of detail the IRS expects? Like is a simple spreadsheet with dates and estimated amounts enough, or do they want more supporting documentation?