Selling tickets to events is a great way to make some extra money, but it does come with some risks. As a ticket reseller, you want to make sure you are operating legally and safely. Here are some tips on how to resell tickets while avoiding scams and unhappy customers.
Is Reselling Tickets Legal?
Reselling event tickets is legal in most states as long as you follow certain rules and regulations. The first thing you’ll want to check is your state’s laws regarding ticket resales. Some states prohibit reselling tickets above face value or without authorization from the original event organizer. Others restrict where and how you can resell tickets.
You’ll also need to abide by the federal BOTS Act, which bans the use of software to purchase tickets. All ticket sales need to be done manually. As long as you are selling your own personal tickets at or below market value and not using bots, reselling tickets is perfectly legal in most cases.
Avoid Getting Scammed
Just as there are scammy ticket resellers out there, there are also fake ticket buyers. Here are some red flags to watch out for:
- The buyer insists on paying with cashier’s check or money order. These payment methods offer no recourse if the tickets turn out to be fake.
- They ask you to send the tickets before payment has cleared or to send the tickets to a different address than provided.
- They communicate primarily via text or email instead of phone.
- There are typos, grammatical errors, or other discrepancies in their communications.
- They ask for your personal information like date of birth or social security number.
Protect yourself by only accepting secure payment methods like credit cards or PayPal Goods and Services. Never send tickets until payment has fully cleared. Also beware of emails that look like they are from PayPal or a credit card company asking you to verify details – these are most likely phishing scams.
Vet Your Buyers
Speaking with your ticket buyers over the phone or via video chat can help assure they are legitimate. Ask them some basic questions like:
- What is their name?
- Why are they purchasing from you instead of directly from the venue?
- How many tickets are they looking for?
- What section/seats are they hoping for?
Genuine buyers should have reasonable answers to these questions. Be wary if they dodge questions or seem uncertain about their plans.
You can also look up their name online or run their phone number through a search to check for red flags. Services like TruthFinder or Instant Checkmate can help uncover details like aliases or criminal records tied to a name or number.
Require Identification
Ask the buyer to send a photo or scan of their driver’s license or other government ID. Compare the name and photo to the person you are communicating with. This ensures you are selling to the actual individual instead of someone posing as the buyer.
Use Safe Ticket Transfer Methods
Carefully choose how you deliver the ticket to the buyer. Popular options include:
- Mobile transfer – Many major ticket sellers now allow tickets to be transferred to a buyer’s account electronically. This provides tracking and ensures only the buyer can use the ticket.
- In-person exchange – Meet the buyer at the event venue and exchange payment for a paper ticket. Only meet in busy, public places during daylight hours.
- Registered mail – Send paper tickets via a mail service that provides tracking and signature confirmation upon delivery.
Avoid sending tickets via regular mail or services like FedEx that do not require a signature. Never send digital tickets until payment has fully cleared either.
Price Tickets Reasonably
While the goal is to make a profit, dramatically inflating ticket prices can also draw the ire of authorities and the public. In many states, reselling tickets at more than a certain threshold above face value is illegal. But even if not outright illegal, exorbitant markups may attract negative attention.
A good rule of thumb is to price tickets no higher than 20% above what you paid. You can also research prices on secondary markets like StubHub and price yours comparably. Allow some room for negotiation so the buyer feels they are getting a fair deal.
Disclose All Details
Being fully transparent about the tickets you are selling helps avoid unhappy customers. Your ad or sales post should include:
- Section, row, and seat number
- Full price breakdown including fees
- Any obstructed views or quirks about the seats
- The event date, time, and venue
- Your refund and cancellation policies
Do not intentionally omit negative details about the seats or make them sound better than they are. Be honest about any flaws so buyers know exactly what they are getting.
Have a Refund Policy
Things happen. Flight delays, injuries, and other unforeseen events could prevent a buyer from attending. Have a set refund policy in place before completing any sales.
Many resellers offer a partial refund if notified 24-48 hours in advance of the event. You can deduct a small cancellation fee from the refund amount. Be clear on exactly what circumstances warrant a refund and how much of a refund will be provided.
Use Reputable Marketplaces
Selling tickets through an established secondary ticket marketplace comes with protections. Platforms like StubHub and Vivid Seats handle payments and guarantees for both buyers and sellers. Here are some benefits of reputable ticket marketplaces:
- Safer payment processing
- No risk of fake/stolen tickets
- Guarantees if event is cancelled
- Mediation for disputes
- Less scam risk as users are reviewed
- Supply/demand analytics provided
- Wider customer reach
While you pay seller fees, selling via trustworthy platforms significantly reduces risks and headaches. The convenience and protections make the fees worthwhile for most resellers.
Use Payment Platforms Wisely
When selling tickets directly to buyers, exercise caution with payment. Avoid platforms like:
- Venmo – Does not offer buyer/seller protections
- Zelle – No recourse for fraudulent payments
- Cash App – Can be used to scam sellers
- Western Union – No way to get money back if scammed
Instead, use services like PayPal Goods and Services which hold payments until any disputes are resolved. This prevents buyers from scamming you with fraudulent payments.
Keep Payment Records
Save all receipts, records of payment, and communications with buyers. If you need to dispute a refund request or fraudulent payment, this documentation will be critical. Keep records of:
- Order confirmations
- Proof of delivery
- Terms and conditions agreed to
- Payment receipts
- All text/email exchanges
Having good records also helps you accurately report reselling income on your taxes. Keep these records safe for at least a year after the sale.
Obtain All Necessary Licenses
Some states require resellers to obtain business or seller’s licenses. Research your state and local requirements to ensure you have any necessary licenses or registrations before selling tickets. Failing to have proper licensing can result in penalties or legal action.
Report Your Income
While exciting, reselling tickets is not a tax-free venture. Be sure to report any profits from ticket resales on your taxes. Keep detailed records so you can accurately calculate tax deductions and account for all income.
Consult an accountant if you are unsure of the tax implications. You generally will owe income tax on any net profits as well as self-employment tax if your overall revenues exceed certain thresholds.
Avoid High Ticket Volumes
For casual resellers or first-timers, stick to selling a handful of tickets at a time. When you start reselling dozens or hundreds of tickets in a year, it begins looking more like an unregistered brokerage business. This could attract unwanted legal attention in some states.
It’s best to slowly grow your reselling activities over time. As volumes increase, be sure to take necessary steps like obtaining business licenses and reporting income.
Steer Clear of Controversial Events
Certain high-profile events draw strong opinions. As a rule of thumb, avoid reselling tickets to events that are politically divisive or emotionally charged. Examples include:
- Political rallies or speeches
- Highly publicized trials
- Hot button social issues and protests
Reselling tickets to these types of events can quickly spark outrage and allegations. It’s safer to focus on reselling less controversial event tickets as a beginner.
Do Not Speculatively Sell
“Speculating” refers to selling tickets you do not yet have in hand. This extremely high-risk practice is banned in many states. Never sell tickets you have not yet officially purchased yourself.
Wait until the tickets are in your possession before advertising, agreeing to sell, or collecting any payment. Patience is key – speculating may allow quicker sales but leaves you open to major losses.
Beware Restricted Tickets
Before reselling a ticket, check for any restrictions like:
- Name of original purchaser printed
- “Not for resale” labels
- Requirements to show IDs
Tickets with printed names cannot be resold. Strictly “not for resale” tickets may carry penalties if caught. And tickets requiring ID will be unusable by anyone but the original buyer. Only resell transferable tickets without restrictions.
Do Not Advertise in Restricted Areas
Check with the venue before advertising tickets for sale on-site. Many prohibit soliciting or exchanges on their property without authorization. You do not want to get removed from the event for unlawfully peddling tickets.
In general, avoid advertising near the venue right before the event. Instead, connect with buyers online ahead of time to arrange a safe meeting spot for ticket exchanges.
Be Wary of Counterfeits
Fake tickets continue to be a major problem. As a buyer, thoroughly inspect any tickets to confirm they are genuine. Tell-tale signs of counterfeit tickets include:
- Generic designs vs. official branded tickets
- Lack of anti-counterfeit features like holograms
- Misspellings or grammatical errors
- Missing or incorrect ticket numbers
- Unclear/photocopied print
- Already scratched redemption codes
If you suspect a ticket is fake, walk away from the purchase. Only buy from reputable sellers with lots of positive reviews.
Conclusion
Reselling tickets provides an opportunity to make money. But failure to take necessary precautions could leave buyers or sellers unhappy, scammed, or even facing legal penalties. Protect yourself by researching applicable laws, carefully vetting buyers, handling payments securely, and avoiding high ticket volumes. With some common sense and patience, reselling tickets can be a financially and legally safe endeavor.