Taxes...

[DannyCruz]

Hey Guys!!! Considering this is my first year as an escort, I was wondering how some of you deal with taxes. What advice could you give me on this issue? In addition, other people have suggested I pay with cash as much as possible, versus credit cards. What are your thoughts?

[RM]

Hmmmmm. Are you asking what is the way to conduct your business to use the tax laws to best advantage, and to document your expenses properly, or are you asking how to hide your income so that the taxing authorities won't discover that you have an income?

 

If you are trying to hide income, don't put much money in a bank. Pay cash for most everything except necessary living expenses and business expenses that you show on your tax return. Not many people get audited these days, but not declaring all your income is still fraud.

 

All income, from whatever source, is subject to income tax, unless the internal revenue code says otherwise.

[Guest pickwick]

Paying for things with cash rather than credit cards has no effect on your tax liability. If you are thinking that this will somehow prevent IRS from discovering the true amount of your income, forget it. It didn't work for Roy Cohn or Leona Helmsley and it won't work for you. If IRS ever decides to investigate you seriously, they can estimate how much you spend and if you don't have records of your purchases it will be rather hard for you to argue with their estimate.

 

The best advice anyone can give you is to report all of your income accurately. There is no need to report what you do to earn it, however. So long as you accurately report your income and pay the proper amount of tax the fact that you earn it illegally will not trouble IRS.

[CT Dick]

We had as escort in Hartford get caught for nonpayment of income taxes. Somehow the IRS figured that he owed tens of thou's!

 

It's pretty sure that the tax man will get you before the vice squad.

 

Dick

[Guest DCescortBOY]

report all income & file taxes accordingly, of course!

[Guest ALLEE]

hire an accountant. better yet, let an accountant hire you, and discuss over dinner while playing footsie under the table :-).

[RM]

The consensus is to report all your income, as a good citizen does. In that case, you will also be reporting lots of legitimate and quasi-legitimate expenses. Your accountant can help you decide which expenses are legitimate business expenses, and which are just personal expenses. If you are audited, you will need to have records that all expenses were incurred and that you paid for them. Lots of expenses have been disallowed because there are no records that they were paid. Receipts, canceled checks, and credit card records are helpful.

[Guest pickwick]

>The consensus is to report all

>your income, as a good

>citizen does. In that

>case, you will also be

>reporting lots of legitimate and

>quasi-legitimate expenses.

 

This is an excellent point. It should be noted that expenses incurred in the conduct of an illegal business are not deductible despite the fact that they are legitimate expenses of the business in question, rather than personal expenses.

 

For example, if you are a heroin dealer one of your business expenses will be the purchase of other substances with which to "cut" your product before it is sold. Clearly this is a business expense rather than a personal expense -- you are not buying this stuff for your personal use but for sale to your customers. But since the business in question is illegal the expense is nevertheless nondeductible. In addition, if you list such an expense as a deduction on your return and IRS questions it, your choices are to explain how it is related to your business or eat the deduction.

[vers7]

Good advise is: Don't mess with mother nature or the IRS.

The fact that your income might not be all gained from entirely legal enterprises won't keep you from getting a whopping tax bill when or if you're audited. You're a paid companion. There's nothing inappropriate with that and you can and must make a reasonably good faith accounting of your income and your expenses (deductions) incurred in obtaining that income. Of course, I suppose no one is 100% accurate with their tax returns and there's always some fudge factor, but the previous advise is very wise that you must make a good faith accounting with the IRS or you'll be sorry.

[Bilbo]

Did you know that some people seriously believe that the federal government was responsible for the invention of AIDS in their biological warfare laboratories? Did you know that the federal government at least didn't pay any attention to the spread of the disease for many, many years which allowed many, many gay men (including my husband of six years) to die, perhaps needlessly?

 

Did you know that you don't make as much as Leona Helmsly and therefore will be of slightly less interest to the IRS?

 

Did you know that the armed forces are still enforcing "Don't Ask, Don't Tell"? That if you are a military widow, you won't get survivor benefits because you are a man? Have you considered the DOMA? Is there a possibility that the federal government could be accused of perceiving you as a second class citizen and have a somewhat hard time proving that they don't?

 

I might allegedly have not paid taxes on all of the money I made as an escort, but I can tell you that the IRS did look at my returns and didn't audit me. In fact, they have corrected my math a couple of times, usually showing that I shorted myself, not them. And there was the time when the were quite quizzical about just why I didn't apply for EIC.

 

I certainly do not encourage you to pay for as many nonessentials as possible with cash which has never seen the inside of your bank account. Do I? What I really, really encourage is that you develope a self employed carreer or three and file Schedule Cs. That way you can pay taxes on your declared income without declaring where it comes from. Acting is a very good source of employment. As is dog breeding. Perhaps you have painted several wonderfully artistic canvases, which, should the IRS staff ask to see a representative one, would be difficult to justify its high price tag. But there is no accounting for the tastes of rich people, is there?

[Bilbo]

And don't forget that if you pay taxes on all of the money you make, you will be building up a lot of credit in the Social Security system. Which will prove immensely important to your retirement plans, just as soon as the government figures out how to 'fix' it so that it will stay fixed and, also, learns how to keep its hands out of its til for other 'needs'.

[DannyCruz]

RM,

 

So you would recommend the continued use of credit cards? I figured the non-use of plastic would be one less way of the IRS tracking your purchases... Hmmmm.

 

Cheers,

 

Danny

[DannyCruz]

Thanks for your imput... I somewhat agree.

 

Cheers,

 

Danny

[DannyCruz]

I will certainly take this information and run with it! It seems clear, then, that I should try and hide my cash as much as possible. Is that what you're getting at?

 

Cheers,

 

Danny

[DannyCruz]

Thanks for the input! I will take this information to heed... Is this the way you conduct you tax situation?

 

Cheers,

 

Danny

[DannyCruz]

Thanks for the advice! Is this how you conduct yourself, regarding taxes?

 

Cheers,

 

Danny

[DannyCruz]

Thank you for the sound advice! Is this how you conduct yourself in this business (ie claiming your full yearly salary)?

 

Cheers, Pickwick...

 

Danny

[DannyCruz]

Thanks for your input, Dick... Do you claim everything you make?

 

Cheers,

 

Danny

[DannyCruz]

Thanks for the advice! Now, if my question regarding taxes had to do with "the way to conduct your business to use the tax laws to best advantage, and to document your expenses properly," what would you advise there? In fact, may I ask how you deal with this issue?

 

Cheers, RM

 

Danny Cruz

[DannyCruz]

Wow!!! Intriguing message... Thanks for the advice, a more for the additional verbiage. It certainly made me think of other matters outside of taxes!

 

Cheers,

 

Dann

[Guest DavidofNYC]

Dear Danny

It seems incredibly naive that you would advertise your intent of deceiving the IRS on taxes on a public forum!

[Guest jeffOH]

My thoughts exactly!

 

Jeff4hire@aol.com

[Guest regulation]

My thoughts are that people who feel so alienated from our government that they feel justified in evading the duties of citizenship should move somewhere else.

 

Perhaps this post belongs on the "Attack on America" board, but Bilbo's harsh words about our government remind me of a discussion he and I have been engaged in for quite some time. The issue is, if you live in a democratic society and have the opportunity to express your views on the issues in public debate and through your vote, do you have an obligation to support the decisions made by your fellow citizens when the discussion is over and a majority have decided on the course that you argued against? I say yes. Can a society prosper or even survive if those on the losing side of the debate on any issue feel free to opt out of the obligations of citizenship for that reason? I say no. I have the distinct impression that his answers to both questions may be different than mine.

[Guest DCescortBOY]

naturally

 

>Thanks for the advice! Is

>this how you conduct yourself,

>regarding taxes?

>

>Cheers,

>

>Danny

[guyinsf]

Well, it certainly isn't easy to "opt out" of taxes. Most of us have them withheld from our wages and have no options to avoid paying income taxes, even if we wanted to.

 

But your argument is particularly interesting on a site like this. I think the majority of the citizens of the US, through their representatives, have made prostitution and hiring prostitutes illegal. Having anal intercourse is still illegal in some states. Many states have passed homophobic ballot measures, only some of which ended up getting overturned by the courts.

 

Are you really trying to say that we all MUST live by the rule of the majority when we're on the "losing" side?