Wisconsin Appeals Court Orders StubHub to Pay $17.1 Million in Unpaid Taxes
Madison, Thursday, 15 January 2026.
Citing willful neglect, a Wisconsin court ordered StubHub to pay $17.1 million in back taxes and penalties for failing to collect levies on ticket sales from 2008 to 2013.
Defining the “Active Seller” in the Digital Age
On Tuesday, January 13, 2026, the Wisconsin Court of Appeals delivered a decisive judgment against StubHub, affirming that the secondary ticket marketplace is liable for $17.1 million in unpaid taxes and penalties [1][2]. The ruling, which centers on the court’s classification of StubHub as an “active seller” rather than a passive intermediary, rejects the company’s long-standing argument that it merely facilitates transactions between third-party buyers and sellers [1][3]. By processing payments, deducting fees, and transferring balances to ticket holders, the court determined that StubHub fulfilled the statutory definition of a “person selling” under Wisconsin law, thereby incurring liability for the state’s 5% sales tax [4][5].
The High Cost of Willful Neglect
Beyond the base tax liability, the court upheld significant financial penalties due to what it termed “willful neglect” on the part of the corporation [1]. The total obligation of $17.1 million is comprised of $8,495,937.50 in back taxes and an additional $8,567,136.15 in interest, fees, and penalties [2][4]. The combined total amounts to 17.063 million, effectively doubling the platform’s liability for the contested period. The court justified the inclusion of a 25% negligence penalty by citing the company’s disregard for state tax guidance [3][4].
Legislative Clarity vs. Retroactive Liability
StubHub’s legal defense relied heavily on the enactment of the Marketplace Provider Law in 2019, arguing that this later legislation indicated that platforms were not liable under previous statutes [3][4]. The company contended that the 2019 law represented a substantive change in tax policy, which should exonerate them from liability for transactions occurring between 2008 and 2013 [4]. However, the appellate court rejected this reasoning, determining that the 2019 legislation merely clarified existing obligations rather than creating new ones [3][4].