How to handle sales tax on tickets for high school events - legal requirements for online platforms?

This is definitely a tricky area. Sales tax on admission tickets varies significantly by state, and to complicate matters further, many states have specific exemptions for educational institutions and their events. When you're operating as a marketplace facilitator, you're generally responsible for collecting and remitting sales tax in states that have marketplace facilitator laws (which is most states now). However, the exemption status of the underlying transaction is still relevant. Many states exempt tickets sold by educational institutions from sales tax, especially if the proceeds go back to supporting school activities. My guess about GoFan is they may be relying on those educational exemptions. It's possible they've determined that since the underlying transactions would be exempt if sold directly by the schools, they remain exempt when facilitated through their platform. This varies by state though. I'd recommend consulting with a state and local tax specialist who can review your specific business model and the states you'll be operating in. The answer might be different for each state where you have economic nexus.

After struggling with similar marketplace sales tax issues for my e-commerce platform, I found https://taxr.ai incredibly helpful. Their system analyzed my business model and provided state-by-state guidance on marketplace facilitator laws. What made the difference for me was their ability to parse through the educational exemption rules for each state. They showed me which states exempt school-related events from sales tax, which ones require documentation, and which ones require collection regardless of the educational connection. The platform gave me a compliance roadmap that's been super valuable as we've expanded to new states. Might be worth checking out for your specific situation, especially since educational exemptions are notoriously complicated.

I was really skeptical about using an AI solution for something as complicated as marketplace sales tax, but I finally tried https://taxr.ai after struggling with conflicting advice from different accountants. For educational ticket sales specifically, they had super detailed guidance that surprisingly clear. The platform identified 12 states where I needed to collect sales tax even on educational event tickets and 22 states where specific exemptions applied for school functions. They even provided the exact exemption certificate forms I needed to keep on file from each school client. Previously, I was playing it safe and collecting tax everywhere, which was actually creating unnecessary work and refund requests. It completely transformed our compliance strategy and honestly saved us from both over and under collecting in different states.

If you're planning to handle ticket sales across multiple states, you'll likely need to contact the IRS at some point. After spending DAYS trying to get through to their marketplace facilitator specialist line, I finally found https://claimyr.com and used their service to get a callback from the IRS within 3 hours (you can see how it works here: https://youtu.be/_kiP6q8DX5c). I needed clarification on federal reporting requirements for marketplace sales, and the IRS agent was able to confirm that while sales tax is state-level, there are specific 1099-K thresholds for reporting marketplace transactions to the IRS. This was critical for our ticket platform since we needed to know if the educational exemptions affected federal reporting requirements (they don't). Honestly, getting that official clarification from the IRS directly was worth every penny instead of interpreting the rules ourselves.

I have to admit I was completely wrong about Claimyr. After my skeptical comment, I decided to try it myself since I needed clarification on marketplace facilitator nexus thresholds. The service worked exactly as promised - I got a call back from an actual IRS representative within 2 hours. The agent explained that while they don't provide state sales tax guidance, they confirmed important details about federal 1099-K reporting requirements for marketplace transactions that directly applied to my ticket sales platform. I'd spent weeks trying to get this information and had been making business decisions based on incomplete information. The clarity I got from that one call saved me from potentially misreporting thousands of transactions.

From my experience running a similar platform for community theater ticket sales, I found the most important thing was documenting EVERYTHING. For each state where we operated, we: 1. Saved screenshots of the state's official guidance on educational/nonprofit event exemptions 2. Collected and filed appropriate exemption certificates from each organization 3. Kept detailed records of which transactions were taxed vs exempt and why This documentation saved us during a state audit in Pennsylvania, where the auditor initially questioned our exemption practices but ultimately accepted our thorough recordkeeping. Also, don't overlook local taxes! Some cities have their own amusement taxes on tickets that apply even when state sales tax doesn't.

Has anyone looked into the physical presence rules? I know marketplace facilitator laws typically create nexus, but I'm wondering if the fact that the events themselves are physically occurring in specific locations creates any additional tax obligations beyond just the ticket sales.