One time Season ticket seat license, deductable?

[Thealy59]

Can the cost of a one time season ticket PSL, or a one time seat license paid three years ago, be deductable from any profits gained from selling said tickets in 2022?

[LouiseS CPA]

Hi  Thealy59,

  I need to make sure we are talking about the same thing. 

If you just decided to sell a ticket that you would not use three years later, this money would be reported on the schedule D, form 8949.  This would show long term gain, and sidestep any self employment tax.  If you receipt where you bought the ticket three years ago, that would be the "Basis" and the sale price would be the proceeds.  As you might suspect, documentation is going to be key for this transaction.

  If you deal in reselling tickets and showed this ticket as inventory on your small business, then yes, you could deduct the cost three years later.  Most people don't fall into this area though.

  Here is another article that speaks to your issue:

https://ttlc.intuit.com/community/file-with-turbotax/discussion/receipts/00/2768378

Thanks for reaching out and I wish your team luck this year,

  Louise

[Thealy59]

Thank you for your answer. What I am specificly referring to is a one-time seat license paid to a sports franchise as a membership, in this case an NBA team in California, for the "rights" to purchase the same seats year after year. This one-time payment, in my case $30K, is in addition to the roughly $16K annual payment for the season tickets themselves. Keep in mind this $30K membership also allows a season ticket holder to pre-purchase tickets to other events at the same venue, such as concerts and other events that can then be sold, sometimes for a profit. Also, there is a stipulation that in 30 years, the $30K stadium "membership" fee will be returned.

Is this $30K something that can be deducted against profits? 

Thank you in advance