Taxes and Auction Site Question

[swarmee]

Originally Posted by insidethewrapper

I wonder if anyone is reporting the profit on these modeern cards selling at auction houses at unbelievable prices. A kid pulls a card from a foil box , get's it graded a "10", send to auction house, makes $ 100K.

So, here's one of my "game theory" type of questions. The IRS doesn't have to audit you in only the year you submit your taxes, they have a couple of years that you're still eligible to be audited. Right?

So knowing how much unreported income is being earned in 2020 by this segment of the population, maybe they don't start auditing this class until 2022 or 2023. Give most of the dishonest sellers some rope, making them think that not reporting on their 2020 tax form went unnoticed. Then audit them next year or two years from now with two-three years of unreported income. Not entrapment, but would effectively entice them to continue cheating on their taxes. Would definitely bear plenty of fruit.