Taxes+Hobby

[Guest101114]

I have been in the XXX hobby for around a year now, and I am trying to gather information about what and how to file my tax return.

I actually have a lot of questions regarding this.....................if you think you can provide information and answer questions I might have please PM me

I would appreciate any helpful advice as well

[Chica Chaser]

Check the Business Services for Providers forum. There are plenty of older ads for tax folks there from earlier in the year.

[TexTushHog]

You start with a good set of books. And receipts. Then talk to a tax professional. And don't wait until the last minute. Now is a good time to visit with him or her about your taxes for this year. That way, you will be prepared to deliver them your earnings and expense information in early January.

[Shayla]

I'm curious, can you actually be a licensed escort anywhere in the US? And is it state issued only?
Here (Canada), you can only claim your income as an escort if you have a license so this is why I ask.

[Sugardaddy]

When people have cash income from specified unlawful activities there is two ways to handle it.

The first is not to report it and live under the radar, off the books. That is called tax evasion. 5 years but often reduce to failure to file and 1y.

The second is to pass it through some shell business to make it look ligitimate and pay taxes on the money. That is called money laundering and carries 20years.

Any money obtained illegally is required to be taxed. James v. United States, 366 us 213 (1961) but to do so will set off a series of investigations and possible forfiture of those funds. meaning they take all the money then require you to pay tax that amount.

[pipefitter73]

Hell, I just want to know how I can deduct all my donations as charitable expenses.

[London Rayne]

I file under "personal services." There is no description required for this option, so you are not getting popped for money laundering...provided you are not an idiot.

It only set me back less than 200 to get a business license for it, and I pay quarterly minus a lot of deductions lol. You can also hire a CPA, but just be careful. People can get perks for reporting you to the IRS for not paying the right amount of taxes.

Pipe, you can't deduct unless it's an actual church...I give waaay too much to not know what carries a tax write off lol.

[Anita Lay]

yep...London is right. Its under the same thing as a massage therapist or personal care assistant. Hmmmm I need to get a business license. Thanks London

[London Rayne]

In my area you can apply over the phone, mail a money order, and they mail you the form...so freaking easy a cave man could do it lol.

[Still Looking]

I figured this thread was going to be a hoot!

In Texas you don't need a license as in most places. You simply get a DBA (Done Business As) Cost is $15.00 here. You'll need a form of ID and social security number. You open a consulting firm. Consulting firms travel making all your travel a write off. If you own a home you rent it to the company. Taxes? What Taxes? You only pay enough taxes to stop from being a nonprofit organization. With the economic down turn the last three years most companies are operating with a loss.

[MrGiz]

Originally Posted by London Rayne

I file under "personal services." There is no description required for this option, . . . .

London is absolutely correct! Personal Services can mean anything from Office/Executive Assistant.... to Office/Property Management Services.... to Business Logistics Services.... etc...

The best way to handle the situation is to find some business person to issue a "1099" for such services at the end of each tax year (exchanging cash for recorded payment)... providing benefit for both parties.

Paying taxes, when obviously enjoying a decent lifestyle, is a "good" thing!!

[Sugardaddy]

Originally Posted by MrGiz

The best way to handle the situation is to find some business person to issue a "1099" for such services at the end of each tax year (exchanging cash for recorded payment)... providing benefit for both parties.

Paying taxes, when obviously enjoying a decent lifestyle, is a "good" thing!!

Filing a false document with the IRS carries up to 3 years.

And if that 1099 is over $10,000.00 you could be charged with smurfing or structuring which is up to 5 years.

[Anita Lay]

YOU GOT THE NUMBER LONDON? LOL

[MacTheKnife]

Originally Posted by London Rayne

IYou can also hire a CPA, but just be careful. People can get perks for reporting you to the IRS for not paying the right amount of taxes.

By the CPA doing so, he/she would lose their CPA license to practice for disclosing confidential client information, even to the the IRS.

I think MOST CPAs would think twice before doing so.

Sugardaddy,

All of your posts are right on point. Advising someone to file a false document with the IRS is a criminal matter with severe repercussions, including loss of the CPA license.

Filing a false document with the IRS is also a criminal matter. Most people forget to read the jurat written in fine print, "Under the penalties of perjury...." when signing documents filed with the IRS.

[Sugardaddy]

Originally Posted by MacTheKnife

By the CPA doing so, he/she would lose their CPA license to practice for disclosing confidential client information, even to the the IRS.

See federal code of evidence Article 515:
"C. Exceptions. There is no privilege under this Article as to a communication:
(1)(a) If the services of the accountant were sought or obtained to enable or aid anyone to commit or plan to commit what the client or his representative knew or reasonably should have known to be a crime or fraud."