View Full Version : Camming And Taxes
sexysasha226
08-28-2013, 05:05 PM
I am 20 years old and a college student i just started camming this week and started to wonder about taxes! being in college and young my parents have always done my taxes and i don't know how to keep this from them. i really want to cam and don't care to pay the taxes i just cant let them find out i told them i wanted to file my own taxes this year and i think they will let me but i am concerned what will happen and how to make sure that they do not find out and also my uncle does their taxes. please help me if their is anything else you need to know just ask oh and i cam at live jasmin but may cam somewhere else if recommended
DahliaDaVille
08-28-2013, 05:26 PM
A simple search of the forum using the search bar here on the website would be a great start. In the meantime, take a look at this thread:
sexysasha226
08-28-2013, 05:34 PM
thanks for advice but this dose not answer my question i have found very similar articles but nothing specific to my exact situation
DahliaDaVille
08-28-2013, 05:35 PM
thanks for advice but this dose not answer my question i have found very similar articles but nothing specific to my exact situation
I highly doubt you've read the entire thread. Please do so before asking for the same advice that's been given more than enough times.
Snowy0Star
08-28-2013, 05:44 PM
if your 20 them ur parents have done ur taxes maybe what once or twice depending on when ur birthday is so "always'..... but anyway filing ur own taxes isnt hard and keeping track of shit isnt hard. make a ledger of ur payments i have a sheet of paper that ive been keeping track of things on i have a column for my date of payment the site its from how much i got paid and the dollar amount in taxes u need to pull out and set aside for taxes i pull out 30% . i also have another sheet of paper that i keep track of my tax right offs. i suggest u keep ur money for taxes and ur day to day money in different accounts thats not ur savings. ideally u would want ur day to day account a savings account with about $2000 or 6 months of daily expenses in case something happens and an account u keep ur tax money in. as far as filing the 1099 i havent had to do that yet as this is my first year camming so i cant help u with that but its easy as long u have kept up good record keeping. sorry if we seemed harsh in gen chat but its just bad etiquette to go in there and start begging and demanding for help the way u were. we really do care and want to help but theres a right way and a wrong way to ask for it.
o yeah sweetie you do need to get off live jasmine as far as what sites to go on i will list them then look up the threads for those sites WITH THE SEARCH FUNCTION every site has its own thread we made sure of that....
adult work (aw) streammate (sm) my free cams (mfc) chaturbate (cb) nightflirt - pso/phone sex operator site (nf) theres also imlive but that one doesnt have a short name
theres also fetish clips
clips4sale (C4s) extra lunch money (elm) my porn profile (MPP)
also PLEASE do NOT make more threads. like i said we are here to help but we try and make this place as clean as possible if u have a question about a site ask in its thread. ppl WILL read it and help.
sexysasha226
08-28-2013, 05:49 PM
thanks for your reply and i know how much to set aside and how to keep up with expenses as well as income the only issue i have with being in college is when i file my own taxes and claim myself as a dependent will my parents find out or will anything go wrong. and what is the best way to handle the situation without them finding out
Snowy0Star
08-28-2013, 05:56 PM
thanks for your reply and i know how much to set aside and how to keep up with expenses as well as income the only issue i have with being in college is when i file my own taxes and claim myself as a dependent will my parents find out or will anything go wrong. and what is the best way to handle the situation without them finding out
ok if they're filing u as an dependent you CANNOT not tell them about your camming you will hardcore fuck them over when they file their own taxes. if u need a story to tell them say u got an online job doing something there's threads on that too.
shanna dior
08-28-2013, 06:00 PM
If you had run a search like other posters had suggested, you would have come across this thread, about a fellow camgirl experiencing the same issues: https://www.stripperweb.com/forum/showthread.php?186631-18-year-old-living-at-home-who-has-NO-idea-about-taxes-help-please!
Long story short, there is no way to handle this without your parents finding out unless you legally emancipate yourself. You're under 25 and a college student, making you their dependent. That means that they file taxes and claim your income as part of theirs - not that you file separately without their knowledge and claim yourself as a dependent. Theoretically, if your parents did not provide 51% of your support, you would file on your own and this wouldn't be an issue (though you would still be considered a dependent through FAFSA), but that would entail telling your parents that, which would surely raise questions as to how you have earned so much money on your own.
Melonie
08-29-2013, 03:32 AM
^^^ additionally, if a student dancer or camgirl has earned enough money to 'challenge' an IRS determination that the parents were actually able to provide 51% of the student dancer / camgirl's financial support, it's very possible that the IRS will audit both the parents and the student. As posted in many other threads, in a 'middle class' family situation, the student daughter's dependent 'exemptions' are worth something in the neighborhood of $3,000 to $6,000. So if parents lose the ability to claim their daughter as a dependent it is likely to increase the amount of taxes the parents owe by $3-$6,000. On the flip side, remaining a dependent of your parents may cost you $3,000 in additional taxes on your camming income.
The absolute bottom line is that, once a US citizen camgirl earns more than $600 in a year, ( with very few exceptions ) her webcam host will create a 1099 payment report and send it to the IRS. That 1099 report will wind up in the IRS database, and when April 15th rolls around IRS computers are going to search all tax returns for a 'matching' reported income ( thus tax payment ) linked to the same social security number listed on the 1099. If the matching social security number is found matching a claimed dependent on a parents' tax return, the IRS will look further to see where the 1099 income was reported on that tax return. If the 1099 income does not appear on the parents' tax return, IRS computers will then search for a different tax return which is linked to the same social security number. If the 1099 income can't be matched up on either tax return, if the second ( camgirl's ) tax return doesn't exist, or if the camgirl's social security number appears as a claimed dependent on both the parents' and camgirl's tax return, an IRS audit is virtually guaranteed to follow.
sexysasha226
08-29-2013, 10:25 AM
thank you for your help and i was going to ask if i start camming in January full time bc this fall is my last semester then will that show up on April 2014 taxes or 2015 bc on 2015 taxes i will be able to be my own dependent. and do my own taxes completely separate.
Snowy0Star
08-29-2013, 10:34 AM
thank you for your help and i was going to ask if i start camming in January full time bc this fall is my last semester then will that show up on April 2014 taxes or 2015 bc on 2015 taxes i will be able to be my own dependent. and do my own taxes completely separate.
i think ur misunderstanding how taxes work. u get the 1099s for the year before like in 2015 you get ur taxes from 2014 and only what u did in 2014 is applicable for the taxes you file in 2015 most ppl ge the paper work in jan and then have till april to file them so if your done with school in 2015 and are unable to to not risk messing things up for your parents if you dont tell them about your camming then u have to wait wait till 2015 to start camming. and in 2016 when you get your 1099s from 2015 is the first time you will file your own taxes.
sexysasha226
08-29-2013, 10:37 AM
no this fall is my last semester so i wanted to start camming in jan 2014 and i would pay the tax for that in april 2015 correct and since i wont be attending college in 2014 i can file my taxes for myself in 2015.
Snowy0Star
08-29-2013, 10:52 AM
no this fall is my last semester so i wanted to start camming in jan 2014 and i would pay the tax for that in april 2015 correct and since i wont be attending college in 2014 i can file my taxes for myself in 2015.
then yes you can start camming after school in 2014 and then file your own for the first time in 2015 for the 2014 year make sense?
sexysasha226
08-29-2013, 11:36 AM
yeah thanks you have been alot of help so when is the soonest i can start camming in 2014 ? jan 1 and it be on 2015 tax right ?
Snowy0Star
08-29-2013, 12:46 PM
yeah thanks you have been alot of help so when is the soonest i can start camming in 2014 ? jan 1 and it be on 2015 tax right ?
pretty much
VeronicaLane
08-29-2013, 04:53 PM
http://us.thesalarycalculator.co.uk/salary.php
i wanted to post this link. you put in how much you made that month and it helps you determine how much you need to put aside for taxes.
Melonie
08-30-2013, 01:32 AM
^^^ I'm certainly no expert on UK taxes, but that calculator seems to be based on 'employee' paycheck earnings. I suspect that taxes on business operations / profits i.e. a self-employed camgirl are treated differently. Specifically, the UK and US both appear to charge higher rates for National Insurance / Social Security for self-employed persons versus 'employees' ( with the self-employed person being required to pay both the 'employer's' and 'employee's' share of these taxes )
See
In the US, being an 'employee' versus 'self-employed' means a difference in Social Security tax rate of 7.65% versus 15.3% ( with US federal and state income taxes being added on top of Social Security tax ). In the UK the National Insurance tax 'rate' is much lower, but the income tax rate is higher. And in the UK there are a bunch of additional tax issues for 'self-employed' persons
See
VeronicaLane
08-31-2013, 08:30 AM
its uk addressbbut its for us.
Melonie
09-01-2013, 04:44 AM
^^^ you appear to be correct that the UK tax site calculator you linked is for US citizen taxes. But it is for 'employees', not independent contractor business operators. As such, it vastly understates overall US tax liabilities for dancers and camgirls because it does not take into account the fact that dancers and camgirls have to pay both the 'employer's' and 'employee's' share of social security and medicare taxes.
AndroidHarkness
09-05-2013, 05:52 PM
If I rented a cheap apartment that I would use only for camming, would that be tax deductible?
Sounds weird probably, but I plan on getting a separate apartment only for cam stuff so I can physically GO to work. If I don't, I won't have the motivation to be on all that much.
Melonie
09-06-2013, 01:23 AM
^^^ by the letter of the law, yes. However the 'real world' result would probably be an IRS audit if you rent the apartment personally ( versus having your LLC or S-Corp rent it ), and perhaps problems with the landlord and/or local zoning authorities for operating a 'sexually oriented business' in a residential area.
chloemay
09-06-2013, 09:12 AM
^^^ by the letter of the law, yes. However the 'real world' result would probably be an IRS audit if you rent the apartment personally ( versus having your LLC or S-Corp rent it ), and perhaps problems with the landlord and/or local zoning authorities for operating a 'sexually oriented business' in a residential area.
What about a little office in a strip-mall? I'm daydreaming here, but having as much lighting as wanted, a green-screen set-up, just stuff that is hard to expalin at home would be fine in an office. It would probably be cheaper then other offices without the need for a lot of windows/ natural light too. I have an S-corp by the way.
Melonie
09-06-2013, 09:19 AM
^^^ sounds like a plan to me !!! Having your S-Corp rent a 'commercial property' shouldn't look at all unusual to the IRS.
annikah
09-07-2013, 06:41 PM
OMG, Melonie! You are such a lifesaver with all that you have contributed to this thread! Although I am new to working in the adult industry, I'm not new to knowing what it means to be an IC. My husband has been one for almost 10 years, working on a construction crew. But after reading your input and explanations, I feel like I knew next to nothing.
Maybe somebody already asked this and I missed it, but I do have another question about deductions. I have a designated room for working. It is small, and probably not even big enough to risk the hassle of an audit that could accompany claiming a home office deduction. But when I get around to redecorating it, I would like to deduct some of the furnishings I'll have in there. As I understand it, a percentage of a large item's value is usually claimed over a number of years. But I was actually considering just renting the furniture. Since that room is strictly for my pso/camming work, could I deduct the furnishings that are in there even if I don't file for the home office deduction, and how much of the rental payment can I deduct, if any at all?
Melonie
09-08-2013, 04:06 AM
^^^ you're really talking about two different deductions ... with the first being the purchase or rental of 'capital equipment'. From an official standpoint this is probably a legal deduction. But in real world terms, the IRS is probably going to raise eyebrows if Rent-A-Center payments show up on a Schedule C because, generally speaking, the 'capital equipment' being purchased or rented has some obvious direct linkage to business operations. Also, the 'amortization' you mention only applies to major purchases ... rental costs are expensed. And for that matter, purchases costing hundreds or a few thousand are now able to be expensed as well i.e. able to write off the entire cost as a business expense under Section 179.
The second is obviously the 'home office' deduction. This deduction allows you to deduct a proportion of your rent / utility / insurance costs etc. The proportion that can be deducted is the same as the proportion of square footage of your 'home office' space versus the total square footage of your home / apartment. In real world terms, claiming the 'home office' deduction vastly increases the amount of attention your tax return will receive, since this deduction has been flagged as the target of massive 'abuse' in previous years. So you may be on the right track by skipping this deduction if it amounts to a very small proportion thus very limited tax savings.
There may also be some reason to think twice about making the fact that you are conducting an 'adult entertainment business' out of your residentially zoned home or apartment a matter of official record. The odds of this ever creating problems is very small. But if it were to ever happen the size of the problems could be very large !!!
Princesstiffany69
09-09-2013, 07:44 PM
All the information in this thread is really helpful! thank you to everyone! :D
Ashley_3
09-13-2013, 02:48 AM
Are there any european girl who pay taxes?
Cam_Model_Jess
09-14-2013, 04:32 PM
^^I sure hope so ;)
U.S. ladies: remember your 3rd quarter estimated tax payment is due on MONDAY (the 16th). Because I'm a glutton for punishment... feel free to PM me if you get stuck & I will try to help. I'm not a CPA though, so be forewarned :)
emeryyld
09-15-2013, 05:08 PM
Edited
Ashley_3
09-16-2013, 01:32 AM
The reason I'm asking is because I think it's really more complicated in my country. From what I read on the previous page it says:
The absolute bottom line is that, once a US citizen camgirl earns more than $600 in a year, ( with very few exceptions ) her webcam host will create a 1099 payment report and send it to the IRS.
But what happens in Europe? I don't think the US based sites are sending any reports to all the countries... I still have no idea if I can and how to pay taxes on webcam earnings. So if there are european girls who do it it'll be helpful to know how they do it.
Melonie
09-16-2013, 03:11 AM
I do my own taxes and my parents claim me as a dependent. They would not have a problem with me claiming myself
As covered in many other threads, this is not a 'free choice'. Besides the FAFSA / IRS edict regarding age 24 for college students, there is also an issue of the 51% support test. If you already lived with your parents or in college housing for several months this year, if you are living with a 'roommate' for the rest of this year, and if your 2014 income level will be far lower than your parents' 2014 income level, your parents will be 'forced' to claim you as a dependent and you will be 'forced' to file your own tax return without being able to claim a personal exemption for yourself. This will indeed increase the effective tax rate that applies to your own 2014 income.
If you also have W2 'employee' income, your effective tax rate will be even higher since the combined amount of your 'employee' income and your camgirl 'business' income will be higher. This will probably mean that the estimated taxes withheld from paychecks by your W2 'employer' will be insufficient to cover the actual taxes due on that income.
emeryyld
09-16-2013, 01:17 PM
Edited
Melonie
09-16-2013, 02:50 PM
No either your parents can report your income on their joint tax return with you not filing a separate tax return ( I think this is limited to $8,000 in 'dependent' earnings max ), or your parents do NOT report your income on their joint tax return and you file your own independent tax return ( I think this is required for >$8,000 in 'dependent' earnings ). In the second case your parents must still claim you as their dependent on their joint tax return ( which gives them ~$4,000 worth of exemptions ) and you cannot claim yourself on your own independent tax return ( which denies you ~$4,000 worth of exemptions ).
emeryyld
09-16-2013, 03:39 PM
Edited
Vlodina
09-17-2013, 12:50 AM
The reason I'm asking is because I think it's really more complicated in my country. From what I read on the previous page it says:
But what happens in Europe? I don't think the US based sites are sending any reports to all the countries... I still have no idea if I can and how to pay taxes on webcam earnings. So if there are european girls who do it it'll be helpful to know how they do it.
If you are looking for information it may help to tell us which country so that someone from there can help?
Ashley_3
09-17-2013, 05:03 AM
I don't think there are other people from my country here and I don't want to share it. It's not the UK. If someone knows or wants to talk about can send me a pm.
november
09-20-2013, 11:12 AM
I missed who had the issue with this but as my vanilla life requires I remain very up to date about tax law, here is your solution.....if you are still a dependent on your parent's taxes and DON'T want to tell them about camming and your 1099. You will "allow" your parent's to claim you AND file your own personal return (1040 + Sch C) for your 1099 and any other vanilla jobs you may have had over the year. When you file you WILL NOT claim your own exemption. As your parent's already have claimed that. Your parent's really don't need to actually know your income to file their taxes and claim you as long as you are a full time student and that the income is earned and not "interest" or trust based. Your taxable income will be slightly higher bc you will not get a personal exemption but this is a small price to pay to ensure your privacy from your parents. Plus you can make up for that in business deductions, cuz there are actually a TON for camming/dancing/modeling.
Anyone that ever needs more specific advice can PM me
However, I don't recommend doing this if you have a FAFSA based on your parent's taxes.(too messy) And an audit is highly unlikely as long as you are paying the taxes on all the income reported to them! IRS does not have time to audit student dependency's unless it comes up with another issue.
Melonie
09-20-2013, 11:18 AM
^^^ there is a big exception to your assertion in cases where the girl is a college student and filing for FAFSA grant / loan money. In that case, the parents must report 'total household income' ... which must include ALL of the student camgirl's income in addition to the parents' income. Since FAFSA and the IRS share information, there is no way to 'back door' this issue. If a college student camgirl fails to inform her parents of her total income, and the parents file a FAFSA student grant / loan application that does not include the camgirl's total income, an IRS cross-check against tax returns will quickly turn up the discrepancy. This in turn is likely to result in both the parents and the college student camgirl being audited, as well as potential 'clawback' of student grant money that was previously paid out based on a 'fraudulently' low figure being provided for 'total household income'.
november
09-20-2013, 11:56 AM
^^^ there is a big exception to your assertion in cases where the girl is a college student and filing for FAFSA grant / loan money. In that case, the parents must report 'total household income' ... which must include ALL of the student camgirl's income in addition to the parents' income. Since FAFSA and the IRS share information, there is no way to 'back door' this issue. If a college student camgirl fails to inform her parents of her total income, and the parents file a FAFSA student grant / loan application that does not include the camgirl's total income, an IRS cross-check against tax returns will quickly turn up the discrepancy. This in turn is likely to result in both the parents and the college student camgirl being audited, as well as potential 'clawback' of student grant money that was previously paid out based on a 'fraudulently' low figure being provided for 'total household income'.
sigh....i know. I realized after i posted that it wouldn't be a good idea with FAFSA (i forget how young a lot of girls here are). I tried to edit right away but my internet quit and it took me freaking 20 minutes to get it going again. But thanks for typing out the reason...I was too lazy to explain LOL
Snowy0Star
09-20-2013, 02:07 PM
going back to the house wives rule do wigs count as a tax wright off or no? i would think so since not everyone buys wigs but some do for fashion / cosplays etc. but i wanted to be sure im not fucking myself over before i drop a few 100 on them and colored contacts ? do fake eyelahses count as a "vanity" item meaning not tax deductible ?
also computer parts normally computer upgrades are wright offs but i got a PSU and case with cold cathode lights in them i wouldnt think i could because theyre kindy "flashy" (pun intended lol) i do have a spare computer that i could say is for personal use and i could say i got the light up stuff because my niche is I'm a geek goddess (witch is true) and i got them to display on cam if i do get audited. like i could say i have it set up so u can see the lights inside from behind me and i have my 25 foot HDMI (witch i also wrote off) so i can set it up to do that -(case behind me monitor in the front )
i know i asked this already but bill deduction- should i wright off 1/2 or 1/4 of the total bills for internet and elec? because my roommate and i split things and im the only that works at home. to me it would make sense if i wright off 1/4 because i use the internet and the cable half the time im home for camming and the other half for personal stuff but if i can get away with half of course i'd like too but i dont want to be audited...
emeryyld
09-20-2013, 06:58 PM
Edited
Melonie
09-21-2013, 12:24 AM
About the 'housewife test', the IRS doctrine is that anything purchased for supposed business reasons, that is also purchased by 'housewives' who have absolutely no business reason for doing so, is subject to potentially being disallowed as a business expense tax deduction. Thus department store wigs and cosmetics may attract audit attention.
As to writing off a fraction of ISP costs as a business expense, by sharing an internet connection with a 'civilian' roommate, you are automatically creating a 50% business use restriction. Claiming half of that half as a business expense is logical, but the IRS may disagree with that logic given that the vast majority of ISP use is personal. This gets even muddier if cable TV and/or phone service is bundled with cable modem ISP service under a single bill.
Computer hardware more or less follows similar logic. A camera is essentially a no-brainer as a business expense deduction. So is a dedicated computer.
Snowy0Star
09-27-2013, 09:00 AM
Should we be taking 40% out instead of 30% my roommates taxes got raised a few months ago and he gets more taxes out of his paycheck taken out now compared to when I first moved in and i read in another thread that another camgirl takes out 40%.
Melonie
09-27-2013, 09:46 AM
Should we be taking 40% out instead of 30% my roommates taxes got raised a few months ago and he gets more taxes out of his paycheck taken out now compared to when I first moved in and i read in another thread that another camgirl takes out 40%.
This depends on what your total 2013 annual income will be, your filing status ( single vs married, kids ? ), whether or not you are a 'dependent' college student, the state and local income tax rates that apply where you live, whether or not you are going to have to pay the new ObamaCare tax penalty for failure to buy 'qualified' health insurance etc.
Snowy0Star
09-27-2013, 09:48 AM
This depends on what your total 2013 annual income will be, your filing status ( single vs married, kids ? ), whether or not you are a 'dependent' college student, the state and local income tax rates that apply where you live, whether or not you are going to have to pay the new ObamaCare tax penalty for failure to buy 'qualified' health insurance etc.
hmm ok well im single and not in school 26 now 27 in jan i guess ill just keep saving up 30 and if its more ill have 3 months to save and pay the difference lol
Aurora14
09-27-2013, 10:06 AM
Should we be taking 40% out instead of 30% my roommates taxes got raised a few months ago and he gets more taxes out of his paycheck taken out now compared to when I first moved in and i read in another thread that another camgirl takes out 40%.
There were certain bills made a few years ago to lessen the tax burden and create "more disposable income" to get us out of the recession. A lot of those provisions expired at different times throughout this year and last year. He's paying more, but he's actually paying what he would have been paying if the provisions weren't put into place. If that makes any sense. Example, I believe that an employee contributes around 8% to social security. When the provision was in place, they paid 6%. (Not sure those numbers are completely accurate, it's been a while since I was an employee) Once the provision expired they went back to paying 8%.
Since we don't have employers, we take the entire tax burden ourselves. So we didn't get that extra 2% during the 4 or 5 years the provision was good for.
I would assume your taxes didn't go up unless your state taxes changed or you moved up a tax bracket. Though it never hurts to put aside extra.
Melonie
09-27-2013, 12:15 PM
The Social Security tax rate change applies to independent contractors as well as 'employees'. Where the 'employee' SSI tax rate went from 5.65% to 7.65%, the independent contractor SSI tax rate ( a.k.a. 'self-employment' tax ) went from 13.3% to 15.3% on the first of January 2013. In either case this is a 2% tax increase.
For both 'employees' and independent contractors, a new ObamaCare IRS tax penalty will kick in ... payable by April 15th 2014 ... if the person does not receive 'qualified' health insurance coverage through an employer and does not choose to purchase 'qualified' health insurance through the just opening Public Health Insurance exchanges. Generally speaking, if you do not have 'qualified' health insurance coverage by this coming January, a 1% additional ObamaCare tax penalty rate will be added to the tax bill due next April 15th. I emphasize 'qualified' because the 'catastrophic only' high deductible low monthly premium health insurance that has traditionally been popular with young, single dancers and camgirls does not 'qualify' ... thus even if you have / continue to purchase this sort of low cost limited coverage health insurance you will still be required to pay the new 1% ObamaCare tax penalty.
There are a bunch of other tax changes which apply to 2013 income and also to 2013 deductions. However, most of these don't apply to average dancers or camgirls who don't have a bunch of 'unearned' investment income, who don't have enough mortgage interest or out-of-pocket health care expenses to itemize deductions, etc.
Also note that the 3% worth of known tax increases above means 3% of adjusted gross income, not 3% of last year's tax bill.
AmberAustin
10-07-2013, 12:53 PM
Are you sure about that? The IRS says:
The individual shared responsibility provision goes into effect in 2014. You will not have to account for coverage or exemptions or to make any payments until you file your 2014 federal income tax return in 2015.
Melonie
10-08-2013, 07:52 AM
^^^ the so-called 'shared responsibility provision' was redefined by the US Supreme Court to be a 'tax penalty'.
However, in regard to your specific question, the Washington Post answers it as follows ...
(snip)"When will the penalties apply? For the 2013 tax year or 2014?
This is probably the easiest question to answer: The tax penalty for not carrying insurance begins with the 2014 tax year. Not carrying any insurance in 2013? No problem, there won't be any fine. But come 2014, most Americans will have to carry health insurance coverage or pay a $95 tax penalty [ or 1% of 2014 adjusted gross income, whichever is greater - sic ]. This tax penalty would be assessed in 2015, likely deducted from a tax refund.
Let's say things get hectic at the start of the year and, due to one reason or another, someone like Frioli forgets to buy insurance right away. Shee gets around to it later in January, or maybe in February.
Even in a situation like that, she would most likely not pay a fine. The health law's mandate makes an exception for short lapses in coverage, which are defined as a period of less than three months. "Thus, the penalty does not apply until a taxpayer goes three consecutive months without adequate coverage," the CCH guide to the Affordable Care Act explains."(snip)
Thus for independent contractor dancers and camgirls, the tax penalty for failure to purchase 'qualifying' health insurance coverage becomes due when 3 months worth of 2014 have passed without having such coverage i.e. April 1st. As such, the first quarter 2014 estimated tax payment due April 15th needs to include the additional amount of estimated taxes due to pay the new Obamacare tax penalty, on top of the amount of estimated taxes due to cover SSI and federal income taxes on their Jan 1 2014 through April 1 2014 dancing or camming income.
For 'employees' the estimated tax issue does not exist, thus actual payment of the tax penalty would finally become 'real' when their 2014 annual tax return must be filed in the spring of 2015. It is assumed that, due to 'standard' employer tax withholding from employee paychecks throughout 2014, that the additional amount due for the Obamacare tax penalty will have already been covered, thus the practical effect for 'employees' will merely be a smaller tax refund in the spring of 2015.
Sorry that I wasn't crystal clear about the different 'real world' implications for independent contractors versus 'employees' in my earlier post. In point of fact, both will 'owe' the Obamacare tax penalty by April 1st 2014 if they have not purchased 'qualified' health insurance coverage by March 31st . However, actual out of pocket payment timing for the Obamacare tax penalty is different due to the different methods of estimated tax withholding.
For what it's worth I would also point out that the new Obamacare tax penalty applying to the first quarter estimated tax payments for self-employed independent contractor dancers and camgirls can potentially provide a new means for the IRS to assess 'under-withholding' penalties. Such penalties can apply when non-first year in business dancers and camgirls' estimated tax payments fall more than 10% below the actual amount of estimated taxes due. Since the entire year's new Obamacare tax penalty must be paid along with first quarter 2014 estimated taxes by April 15th 2014, this increases the probability that an individual independent contractor self-employed dancer's or camgirl's first quarter estimated tax payment will fall short of the minus 10% 'under-withholding' penalty threshold. With some 16,000 new IRS agents having recently been brought on-board for the specific purpose of enforcing Obamacare tax provisions, it would not be at all surprising to find that a great deal of additional IRS scrutiny will be devoted to first quarter 2014 estimated tax payments ( and especially to the lack thereof ) by self-employed persons.
Katie Desire
10-10-2013, 09:54 AM
For me, there's such a huge benefit of being a single mom with absolutely no support--financially or otherwise--so I have a job that I can do while he sleeps, is in school, etc. I don't have to take the crap I got from a large paying corporate job when my kid was sick, had a holiday show, etc. I don't have to force myself in when I genuinely don't feel good. I have no commute. On and on. Every job has it's big downsides--that's why it's work. There are good days and bad, but overall, I find that my clients are so much less demanding than even the "mainstream" clients I have/had once I left corporate to open my own "mainstream" agency, where I was literally on-call all the time, and never could take vacations at any time (vs. getting flack for trying to be gone for a few days)...
So, is it the highest paying job I can get? Are there corporate health benefits (although those have seemed to evaporate with the current political situation)? Is there a stigma, and do I have to "hide" stuff? Yep. But for now, it's the job for me, and I DO have a "five year" plan for when my son is old enough for me to work a little more mainstream if I want, and if our crazy economy supports that. It is a personal decision for each of us, and I have respect for EACH opinion posted!