Source: Fortune
Summary
Some individuals are buying large quantities of losing lottery tickets on eBay, with prices ranging from $10 to $575 for thousands of dollars’ worth of tickets. The tickets are often listed as “collectibles” or for “arts and crafts” purposes, but some listings suggest they are being used for tax write-offs. The IRS allows gamblers to deduct losses against winnings, but only if they itemize and keep accurate records. Experts believe that some individuals may be using these tickets to commit tax fraud.
Our Reading
The strategy enters a familiar phase.
EBay’s policy prohibits listings that promote potentially improper uses of items, but some sellers are finding creative loopholes. The IRS’s own compliance record on gambling income suggests that many winners don’t report their winnings, and some may be using fake tickets to offset their taxes. The timing of purchases on eBay suggests that some individuals may be committing fraud by buying tickets in bulk around tax season.
Some people collect all sorts of random pieces of paper for whatever reason, but in this case, it’s likely that many of these tickets are being used for tax write-offs. The fact that eBay removes listings that go against its terms of service doesn’t stop creative loopholes.
The purchase of losing lottery tickets on eBay is a form of tax fraud, and it’s likely that many individuals are using these tickets to offset their taxes. The IRS’s own compliance record on gambling income suggests that many winners don’t report their winnings, and some may be using fake tickets to avoid paying taxes.
The numbers tell one story, but the listings on eBay tell another.
The fact that eBay allows these listings to exist, despite its policy, suggests that the company is not doing enough to prevent tax fraud.
Author: Evan Null
