Where do I list expenses I incurred by reselling Event Tickets?

[tmarra]

I sold Event tickets on StubHub

[LindaS5247 · Accepted solution]

You will only be able to deduct expenses related to your sale of tickets if you are considered a business. If you sell tickets regularly and you depend on the income and have made a profit in three of the last five years, you could be considered "Self-Employed". ‌

In that case you will be able to deduct expenses related to your ticket sales on Form Schedule C, "Profit or Loss From Business".

You can't deduct expenses incurred by reselling StubHub tickets if you are filing as a hobbyist. ‌You would be considered a "hobbyist" if the money you made isn't money you depend on, or the money made was incidental and made doing something you enjoy, and you didn't spend time doing it often and regularly.  

The screens you will see in TurboTax, when entering your 1099-K, have additional information regarding hobbyist vs self-employed.  This is a helpful guide to determine if you are self-employed vs a hobbyist. 

Select the type of income you are entering and it will display the "Learn More" links to click on. 

Your screens will look something like this:

Click here for additional information on entering Hobby Income.

Click here for information on entering your self-employed income into TurboTax.

Click here for information regarding when your business is considered a hobby.

[asdfkjalfjskaljfdk]

"You can't deduct expenses incurred by reselling StubHub tickets if you are filing as a hobbyist."

Here is the problem with this statement:

SeatGeek sends a 1099-K that includes what is deposited in the bank account of the seller by SeatGeek AND the fees that SeatGeek charges the seller per transaction.

So the taxpayer filing as a hobbyist is expected to have the fees SeatGeek retained to be counted as income? Further, the taxpayer filing as a hobbyist is expected to have what the taxpayer paid for the tickets count as income?

Where does TurboTax ask for the fees SeatGeek included in the 1099-K they provided to the seller?

Where does TurboTax ask for the costs the taxpayer paid for the tickets?

Thank you.

[DianeW777]

It depends. The information here will simplify your answer. 

1. If you are considering this a business then expenses can be used against the income. 
2. If this is a hobby then no expenses are allowed to be used against the income.
3. If this is a sale of personal items (tickets) you bought and were unable to use this them, the sale of personal items and a cost cannot exceed the selling price. The reason is simple, if you are using the tickets for personal purposes and sell at a loss it cannot offset other taxable income.

You can decide if it is hobby or business income.  This IRS link will help you: Business or Hobby?

Key elements:

1. A hobby requires you to report the income you received and under the current tax law, Tax Cuts and Jobs Act (TCJA), no expenses are allowed to be used to reduce the money collected even if you itemize deductions.
2. A business allows you to deduct the costs necessary to obtain the income.  The law explains that 'you must be engaged in the activity to produce a profit'.  The test under IRS tax law is that you must show a profit three out of every five consecutive years to be considered a business.

Once you decide what type of income this is you can use the links below to see how to report.

Business: 

Where do I enter Schedule C?

Personal use sales:

Do I have to report the sale of personal items?

Hobby:

Other Miscellaneous Income:

1. Go to the Wages and Income  section of TurboTax
2. Scroll to  Less Common Income > Select  Miscellaneous Income, 1099-A, 1099-C
3. Select Hobby Income and Expense > Enter the income

@asdfkjalfjskaljfdk 

[asdfkjalfjskaljfdk]

I went to the link provided, and it said:

"Here's where you'll enter any hobby income you made in 2024 that you *didn’t* get a 1099-K for."

[DianeW777]

The key is to report your income, it's not a requirement for you to complete a Form 1099-K to file your tax return.  What is required is to report the taxable income you received during the tax year. As long as you keep your tax documents in your tax records and can show the income you reported, that's all that matters.

@asdfkjalfjskaljfdk