Paying Taxes?

[Guest boiworship08]

Paying taxes??? This will be my last substantial year paying taxes.....woohoo!!!!! I'm going into semi-retirement next year, just keeping a few clients for side work and minimal income. My goal is to have income so low that I no longer pay income taxes (or very little), and can perhaps even qualify for the earned income tax credit, and tax credits to pay for my health insurance. Happy days are almost here!

 

I imagine, given the higher federal and CA tax rates next year, more than a few will be following your course. I'm seriously thinking of relocating to Washington state to avoid the looming CA tax increases. Our one-party state will tax and tax now with impunity.

[kevininsa]

The IRS most definitely enforces taxes on illegal activity. There are also extremely stringent laws protecting the privacy of tax returns. No way would or could the IRS report to law enforcement authorities that income was gained illegally. In any case, that would be extremely stupid and counter-productive... All the IRS cares about is that the taxpayer reports his income accurately (and pays his taxes, of course). They don't care about the details about what you did to whom.

 

Just came across this thread and thought I would add my 2 cents. I work for the IRS. First, I'm not reporting anyone. I don't care that much. But what Unicorn said is correct. The IRS only cares that you report, not what you do. They do not share that kind of info with law enforcement. You could probably put down Assassin and claim ammunition as an expense, nobody would care.

 

While the boundaries of a home office were eased up, the space still has to be exclusive and not used for anything else. It is still one of the bigger audit flags. Plus, anything you deduct comes back and smacks you in the face when you sell the property because then it goes against your cost basis. An entire cell phone bill can be deducted because you have to have the entire plan to use the service. Can't buy half a plan. Same with internet. Computer should be divided. Uniform has to be something you can't wear elsewhere (like a dental hygenist smock). If your uniform is regular everyday clothes and it's caught in an audit (which is doubtful), it will be disallowed.

[dannyboynyc]

That sounds about right to me. Then again, it wouldn't be terribly hard to identify who that top 10% might be, and going after them might be very worthwhile. But I suspect IRS finds tax cheats not from culling successful escorts, but from spending and deposit patterns unsupported by tax returns, regardless of the source of the income. For what it's worth, I've read that the IRS estimates 57% of self-employment income goes unreported. (http://www.nytimes.com/2006/04/02/magazine/02wwln_freak.html?pagewanted=print&_r=0)

 

Kevin Slater

 

Kevin - the statistic you quoted is not surprising. Several lifetimes ago I was a tax accountant and did many small, "mom and pop" family owned business tax returns. Most of these people didn't report most of their cash income, then, were shocked when they needed to substantial income (as noted - for a loan, etc) and were out of luck. I totally agree it makes sense in many ways for escorts to report income and pay taxes.

[josephga]

I actually got a check from the IRS today i wasn't expecting. in April i was sick I had my taxes done but forgot to mail them. in july I found them while doing paperwork I mailed them in with my payment. about a week later I got a letter saying I was being fined for failure to pay on time plus interest... I sent in the payment. for some reason today they gave the fine back

[+ Travis69]

Try to file as early as possible in the future. A friend of mine had his identity stolen for a fradulent tax return. He still hasn't gotten it all straightened out.

[+ Tom Isern]

here's what nobody has said: TAX EVASION IS A FELONY offense. prostitution, which none of us do because it means charging for specific sexual activities—right?, is only a misdemeanor. there is a HUGE difference and if you're escorting you should know this.

 

as others have said here, the IRS doesn't really care HOW you make your money, as long as your report it. the big danger in this business is tax evasion.

[marylander1940]

Not unusual at all. Many people who work for cash only (maids, escorts, givers of massage, home repairmen, gardeners, etc) not only do not pay taxes but collect the many benefits meant for the poor as well. I have known a lot of these people.

 

Hold on... they don't make a fortune...

 

Several top escorts that I have gotten to know well have confided that their big problem is what to do with cash. In some cases, it involves hundreds of thousands of dollars.

Most/some escorts do make a lot of money.

 

Bump... Do escorts pay taxes in order to put their money in a bank and use it for mortgages.

[rvwnsd]

Hold on... they don't make a fortune...

 

 

Most/some escorts do make a lot of money.

 

Bump... Do escorts pay taxes in order to put their money in a bank and use it for mortgages.

It is not just about being able to deposit money in a bank. It's about being able to verify income so one can have a credit card, purchase an automobile by taking out a loan, leasing an apartment, buying a condo/house...

 

EDIT: I know you (@marylander1940) were simply replying to the earlier post and likely know there are more reasons to file a tax return than depositing money in the bank.

[marylander1940]

It is not just about being able to deposit money in a bank. It's about being able to verify income so one can have a credit card, purchase an automobile by taking out a loan, leasing an apartment, buying a condo/house...

 

EDIT: I know you (@marylander1940) were simply replying to the earlier post and likely know there are more reasons to file a tax return than depositing money in the bank.

 

I know escorts who have an apparent job as personal trainers and deposit money, pay taxes, have CC, verify their income, and have a 401K based on that alleged job.

[Kevin Slater]

Do escorts pay taxes in order to put their money in a bank and use it for mortgages.

 

Yes.

 

Kevin Slater