Experienced Escorts Please!!

[hunterlee]

I am asking for a huge, huge, huge favor "information wise". Are there any escorts / masseurs who travel a lot (for the past few years)/ and or have been declaring their income from escorting to the irs (for the past few years), could please please please private message me.

[Kevin Slater]

Done.

 

Kevin Slater

[Guest countryboywny]

Hunter,

I'm not an escort, but I am a business owner and have had irs agents come in asking for information about people who have been my customers. When I asked the agent what tipped them off, he responded, "Well, we noticed his private helicopter and we looked at his tax return and something didn't add up." So, my advice to you and all who work in a cash business, "SHOW ENOUGH INCOME ON YOUR TAX RETURN TO SUPPORT YOUR LIFESTYLE". For example, if you live in a NYC condo and are paying $5,000 and month rent.. don't submit a tax return showing your income at $60,000.

[nycguy]

Hunter,

I'm not an escort, but I am a business owner and have had irs agents come in asking for information about people who have been my customers. When I asked the agent what tipped them off, he responded, "Well, we noticed his private helicopter and we looked at his tax return and something didn't add up." So, my advice to you and all who work in a cash business, "SHOW ENOUGH INCOME ON YOUR TAX RETURN TO SUPPORT YOUR LIFESTYLE". For example, if you live in a NYC condo and are paying $5,000 and month rent.. don't submit a tax return showing your income at $60,000.

 

IRS agents would be fired on the spot for relaying to a third party what "tipped" them off about someone they were investigating and releasing any personal information about the taxpayer such as he had a private helicopter. Nor do IRS agents just walk into a business and start asking questions about another taxpayer. At best, you might receive a written communication from the IRS asking for details about a particular transaction you had with a customer.

 

Paying $5,000 a month in rent in NYC and only declaring $60,000 in income will not trigger an audit. Years and years ago, the IRS would perform a limited (tiny) number of net worth audits on randomly selected taxpayers. Those days are long gone. Declaring 60k of adjusted gross income on a tax return and deducting 5k a month in mortgage interest deductions is a different story - that is something that is built into their computer audit checks that red flag something for an agent to investigate. The IRS has no statistics on rental payments to cross check against reported income.

 

I assume that virtually every escort plays the audit lottery and does not report their earnings from escorting. There is little chance of getting caught. What the escort loses by doing that can be substantial down the road if there have been many years of not paying into the social security system. What one receives in SS is based on what one paid into it (to simplify a very complicated formula used to determine SS payments) . There can be other substantial negatives one runs into for not showing taxable income as well.

 

I have had a long career in being on the other side of the IRS so I do know a thing or two about what I am talking about. None of what I am saying should be taken as my advocating not reporting taxable income.

[Jock123]

Hunter,

I'm not an escort, but I am a business owner and have had irs agents come in asking for information about people who have been my customers. When I asked the agent what tipped them off, he responded, "Well, we noticed his private helicopter and we looked at his tax return and something didn't add up." So, my advice to you and all who work in a cash business, "SHOW ENOUGH INCOME ON YOUR TAX RETURN TO SUPPORT YOUR LIFESTYLE". For example, if you live in a NYC condo and are paying $5,000 and month rent.. don't submit a tax return showing your income at $60,000.

 

 

Exactly what he said.

 

http://49.media.tumblr.com/2aaf06ee6a5ab581b57156dab2f753cf/tumblr_nvkg40HQ1Y1tfn6k7o1_500.gif

[Guest countryboywny]

IRS agents would be fired on the spot for relaying to a third party what "tipped" them off about someone they were investigating and releasing any personal information about the taxpayer such as he had a private helicopter. Nor do IRS agents just walk into a business and start asking questions about another taxpayer. At best, you might receive a written communication from the IRS asking for details about a particular transaction you had with a customer.

 

Paying $5,000 a month in rent in NYC and only declaring $60,000 in income will not trigger an audit. Years and years ago, the IRS would perform a limited (tiny) number of net worth audits on randomly selected taxpayers. Those days are long gone. Declaring 60k of adjusted gross income on a tax return and deducting 5k a month in mortgage interest deductions is a different story - that is something that is built into their computer audit checks that red flag something for an agent to investigate. The IRS has no statistics on rental payments to cross check against reported income.

 

I assume that virtually every escort plays the audit lottery and does not report their earnings from escorting. There is little chance of getting caught. What the escort loses by doing that can be substantial down the road if there have been many years of not paying into the social security system. What one receives in SS is based on what one paid into it (to simplify a very complicated formula used to determine SS payments) . There can be other substantial negatives one runs into for not showing taxable income as well.

 

I have had a long career in being on the other side of the IRS so I do know a thing or two about what I am talking about. None of what I am saying should be taken as my advocating not reporting taxable income.

 

I have no doubt that you know what you're talking about, maybe. But what I was pointing out was that if one is living a millionaire lifestyle and not reporting sufficient income it raises eyebrows. My reference to the helicopter was just an example. Now, as for the irs agents who appeared at my office door with a records warrant for a certain individual(s) that is true and that is exactly the reason they were looking at our sales records.

[Kevin Slater]

I assume that virtually every escort plays the audit lottery and does not report their earnings from escorting.

 

You assume incorrectly.

 

Kevin Slater

[nycguy]

You assume incorrectly.

 

Kevin Slater

 

I doubt it.

[Marlfox]

nycguy are you suggesting that escorts don't report any of their income from escorting? Maybe that is true is someone with another full time job and only escorts occasionally on a part time basis. However I'd be surprised if that were the case for someone for whom it is a full time job and their sole source of income.

Of course in a business where cash is paid and receipts not given, I'm sure that not all escorts report all of their income.

[nycguy]

nycguy are you suggesting that escorts don't report any of their income from escorting? Maybe that is true is someone with another full time job and only escorts occasionally on a part time basis. However I'd be surprised if that were the case for someone for whom it is a full time job and their sole source of income.

Of course in a business where cash is paid and receipts not given, I'm sure that not all escorts report all of their income.

 

Yes, I am suggesting that I believe most escorts do not report income from escorting to the IRS or State. It is way too tempting and way too easy not to report it. For those that do, there are a couple of different ways to do so - Self employment income with details reported on Sch C or a one line item as miscellaneous income. Either method could possibly be problematic for one who is running an illegal business such as prostitution should that be uncovered during an audit. Don't forget it's not just the IRS who audits but states as well. An escort can quickly have a very large tax bite from Federal, State and sometimes city income taxes. On top of that the escort is also subject to a FICA tax rate of 15.3% on his reported gross earnings. The Social Security tax part of FICA is applied to the first 118K of earnings and there is no earnings limitation on the much smaller Medicare tax part of FICA. I don't want to take the issue to a level of absurdity, but an escort is also subject to income tax in each state he has worked out of during any given year.

 

An escort who reports and pays all of the required taxes is going to have to be a very, very busy boy to make ends meet after paying tax. It is much easier and much less expensive to try to fly under the radar and not report earnings from a cash business.

[Marlfox]

nycguy, thanks for the response. I still find it hard to believe that no escort declares income from escorting for tax purposes. More and more are accepting credit card payments and they can't be hidden as cash can.

In Australia income tax is only levied by the federal government. I worked for the Tax Office in pre internet days. Back then the TO had officers who would contact prostitutes who advertised in the press to ensure that they declared their income. That they were engaged in an illegal activity was irrelevant.

[instudiocity]

IRS agents would be fired on the spot for relaying to a third party what "tipped" them off about someone they were investigating and releasing any personal information about the taxpayer such as he had a private helicopter. Nor do IRS agents just walk into a business and start asking questions about another taxpayer. At best, you might receive a written communication from the IRS asking for details about a particular transaction you had with a customer.

Um, two words, Lois Lerner.

[Kevin Slater]

For those that do, there are a couple of different ways to do so - Self employment income with details reported on Sch C or a one line item as miscellaneous income.

 

Wrong again. There is one way to declare it: on a schedule C (or C-EZ).

 

Line 21 ("other income") is not for self-employment income but rather items such as jury duty pay, gambling winnings, hobby income, etc.

 

Either method could possibly be problematic for one who is running an illegal business such as prostitution should that be uncovered during an audit.

 

The IRS doesn't give a shit as to how you make your money (other that ensuring that you give it the appropriate tax treatment). Not paying taxes on illegal income would be a crime in itself. See Al Capone.

 

Your logic escapes me. It's the fellow who doesn't pay his taxes that is less at risk of an audit?

 

Don't forget it's not just the IRS who audits but states as well. An escort can quickly have a very large tax bite from Federal, State and sometimes city income taxes. On top of that the escort is also subject to a FICA tax rate of 15.3% on his reported gross earnings.

 

Yes. And one pays all of it. As well as perhaps the unincorporated business tax and the metropolitan commuter transportation mobility tax (here in NYC anyway).

 

An escort who reports and pays all of the required taxes is going to have to be a very, very busy boy to make ends meet after paying tax.

 

As is any self-employed professional.

 

Kevin Slater

[+ Lance_Navarro]

Yes, I am suggesting that I believe most escorts do not report income from escorting to the IRS or State. It is way too tempting and way too easy not to report it. For those that do, there are a couple of different ways to do so - Self employment income with details reported on Sch C or a one line item as miscellaneous income. Either method could possibly be problematic for one who is running an illegal business such as prostitution should that be uncovered during an audit. Don't forget it's not just the IRS who audits but states as well. An escort can quickly have a very large tax bite from Federal, State and sometimes city income taxes. On top of that the escort is also subject to a FICA tax rate of 15.3% on his reported gross earnings. The Social Security tax part of FICA is applied to the first 118K of earnings and there is no earnings limitation on the much smaller Medicare tax part of FICA. I don't want to take the issue to a level of absurdity, but an escort is also subject to income tax in each state he has worked out of during any given year.

 

An escort who reports and pays all of the required taxes is going to have to be a very, very busy boy to make ends meet after paying tax. It is much easier and much less expensive to try to fly under the radar and not report earnings from a cash business.

 

For those of us who escort full time and don't have a secondary job, not reporting our income isn't really an option. Your assumptions, I'm guessing, are based on escorts who have a primary income other than sex-work.

[hunterlee]

i'm sorry for stirring up trouble :(

[jimboivyo]

Wrong again. There is one way to declare it: on a schedule C (or C-EZ).

 

Line 21 ("other income") is not for self-employment income but rather items such as jury duty pay, gambling winnings, hobby income, etc.

 

 

 

The IRS doesn't give a shit as to how you make your money (other that ensuring that you give it the appropriate tax treatment). Not paying taxes on illegal income would be a crime in itself. See Al Capone.

 

Your logic escapes me. It's the fellow who doesn't pay his taxes that is less at risk of an audit?

 

 

 

Yes. And one pays all of it. As well as perhaps the unincorporated business tax and the metropolitan commuter transportation mobility tax (here in NYC anyway).

 

 

 

As if any self-employed professional.

 

Kevin Slater

 

 

Once again, mr slater is right on the mark. nice reply sir.

[+ not2rowdy]

i'm sorry for stirring up trouble...

 

Don't be sorry for asking a legitimate question of concern. If it stirred up "trouble" it's not your fault. The discussion that's taking place is valid and of interest to the community.

[rvwnsd]

i'm sorry for stirring up trouble :(

You did not stir up trouble. You asked a legitimate question that elicited, for the most part, legitimate answers.

 

Over the course of hiring, the notion of paying taxes has arisen in conversation with a handful of escorts. All of them filed tax returns. As one escort remarked, the only way to rent an apartment, buy a car, or acquire a credit card is to have income that can be substantiated. For self-employed individuals, that substantiation is a tax document, such as a return or quarterly tax payment vouchers.

[+ not2rowdy]

Slightly off track but still definitely related:

 

...What the escort loses by doing that can be substantial down the road if there have been many years of not paying into the social security system. What one receives in SS is based on what one paid into it...

 

Calculating Social Security. This only applies to the USA.

The law can change and likely will. But here are some considerations based on current law. And there are exceptions here - but, in general:

 

To receive Social Security when you reach retirement age (probably 67+ for most of you at this point).

 

You must earn 40 qualifying credits. In general you earn a credit per quarter (max 4 per year) for each quarter you make (and report) about $1200 in earnings. There are exceptions such as being able to “skip” quarters during a year so long as the yearly total at least equals the minimum 4 quarters for the year.

 

However, if you only meet the 40 quarter minimum requirement (10 years), at the minimum earnings, don’t expect to receive a very big Social Security check.

 

That’s because your total reported earning, by year, go into the “big” calculation. Again, it’s more complicated than this but, in general:

 

Your top 35 years of reported earnings are used. Think of this as a spreadsheet with 35 lines. ALL lines will be filled. Either with an earnings number or a zero. Zeros are bad! Now this is all adjusted for inflation. But zeros are still zeros.

[+ not2rowdy]

And just to make one additional point.

I have a vested interest in your success.

I paid into the system - and have no “zeros” in my calculations.

 

I want all you young swinging dicks out there working your asses off making, and reporting, lots and lots of income!

 

That way my social security payments will be funded! Selfish and totally self-serving huh?

[nycguy]

Wrong again. There is one way to declare it: on a schedule C (or C-EZ).

 

Line 21 ("other income") is not for self-employment income but rather items such as jury duty pay, gambling winnings, hobby income, etc.

 

 

 

The IRS doesn't give a shit as to how you make your money (other that ensuring that you give it the appropriate tax treatment). Not paying taxes on illegal income would be a crime in itself. See Al Capone.

 

Your logic escapes me. It's the fellow who doesn't pay his taxes that is less at risk of an audit?

 

 

 

Yes. And one pays all of it. As well as perhaps the unincorporated business tax and the metropolitan commuter transportation mobility tax (here in NYC anyway).

 

 

 

As if any self-employed professional.

 

Kevin Slater

 

 

I know that the only proper way to report is through Sch C. Reporting as misc income is an alternative to pay income tax for some who do not want to go into too much detail. It offers some protection. The IRS doesn't give a shit how you report as long as the income is reported. Reporting as misc income would cover income taxes but not FICA taxes.

 

I stand by everything I have said as I know human temptation. Whether you are running an all cash escort business or selling a thousand slices of pizza a day, when that cash sits in your drawer you can send a substantial amount to the tax man or choose to spend it. Guess which choice usually wins.

 

Most of us have no choice in the matter as taxes are withheld on wages and other income is reported through 1099s.

 

For those in the all cash business, many are not reporting their income or substantially under reporting it. It's the way of the world.

 

Again, human nature and human temptation prevents many from paying ALL OF IT.

 

It can sometimes be true that one who does not report income is less subject to an audit . It all depends on whether or not one gets too clever by half in reporting their income and expenses to show little taxable income.

 

I applaud you for paying ALL OF IT. Few of us actually choose to do so if it way too easy not to.

[BaronArtz]

You assume incorrectly.

 

Kevin Slater

 

I am wondering whether the government raid on rentboy.com has led to tax audits of escorts who didn't report income to the IRS. The IRS now has the real names of the escorts involved, if they paid their rentboy subscription fees with a credit card or other traceable form of payment.

[Kevin Slater]

I am wondering whether the government raid on rentboy.com has led to tax audits of escorts who didn't report income to the IRS. The IRS now has the real names of the escorts involved, if they paid their rentboy subscription fees with a credit card or other traceable form of payment.

 

I sort of doubt that would be a worthwhile program to operate.

• The servers were seized by DHS, a different department than IRS (Treasury).
   
  
• They'd perhaps have names but probably not addresses nor SSNs (hard to correlate to returns).
   
  
• You'd have evidence of an expense, but scant evidence of income.
   
  
• The raid is already proving somewhat unpopular.
   
  
• And most importantly, I'm guessing that vast majority of escorts wouldn't be worth going after; the phrase blood out of a turnip comes to mind.
  

Kevin Slater

[BaronArtz]

• And most importantly, I'm guessing that vast majority of escorts wouldn't be worth going after; the phrase blood out of a turnip comes to mind.
  

Kevin Slater

 

Are you suggesting most escorts don't make any real money?

[Kevin Slater]

Are you suggesting most escorts don't make any real money?

 

Or don't keep much of what they make.

 

Kevin Slater