Did You Sell Concert Tickets or Clothes? You May Owe Taxes

If you sold personal items like concert tickets or used clothing online last year or received money for services through payment apps, you may get an unfamiliar tax form this year.A tax law change means most online marketplaces and payment apps must send the Internal Revenue Service a form called a 1099-K, with a copy to you, if you received more than $5,000 in payments for “goods or services” in 2024.That’s down from a threshold of $20,000 in payments and more than 200 transactions.

(Starting in 2024, the number of transactions no longer matters.)“As the threshold keeps going down, it catches more people,” said Melanie Lauridsen, vice president for tax policy and advocacy at the American Institute of Certified Public Accountants.Under the old cutoff, the forms mostly went to people running active businesses rather than to occasional or small-time sellers.“This substantial drop in the reporting thresholds could result in millions more taxpayers receiving Forms 1099 this filing season than in prior years,” according to a blog post by Erin M.

Collins, the national taxpayer advocate, who leads a group within the I.R.S.that works on behalf of taxpayers.Here’s what to know about Form 1099-K:Who’s eligible to receive Form 1099-K?If you bought several concert tickets, for example, and resold them online at a markup, you could potentially meet the 2024 threshold for getting the form, Ms.

Collins said in an interview.Tickets for big-name concerts, she said, such as performances by Taylor Swift, have reportedly sold for more than $1,000 per ticket.

If the seller made money, the gain is taxable.The rule doesn’t apply to personal payments, like gifts or transfers of money to friends and family, the I.R.S.says.

If you and a friend go to a concert, and your friend pays you for the ticket using a payment app, “you should not receive a Form 1099-K for the reimbursement and, generally, it would not be taxable,” according to “common situations” descri...