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xxxGothBarbie
04-18-2017, 08:09 PM
If it works the same way in Canada as in the US, he is correct. If you weren't making quarterly payments throughout 2016 on your 2016 income, you now owe ALL of that by the tax deadline this month. And now, going forward, you will have to start making quarterly payments on your 2017 (this year's) income.

April is when "1st quarter" is due for 2017 income. This first quarter payment is basically your taxes on what you made between January and now.

Quarterly payments are payments you make for the current year, as you go along - Normally, this money would be taken out of a paycheck each week/month if you were at a normal job, but since you are an independent contractor, you are not paying taxes "as you go" from each paycheck. Therefore, you have to pay a lump sum quarterly to stay on top of what would normally have been coming out of a paycheck. Technically speaking, since you were an independent contractor in 2016, you should have been making quarterly payments on your 2016 income back in 2016, but since you didn't, you now owe the entirety of 2016's payments. They generally give you a pass for the first year as an independent contractor - you have to pay all the taxes you owed from 2016, but they won't penalize you for not paying quarterly last year, but going forward, they now expect you to - hence the payment due for this year's first quarter. It just sucks that both those payments are due at the same time.

If you don't make the quarterly payments this year, next year, not only will you owe the entirely of 2017's taxes by April 2018, but you'll get fined for "underpayment" from not paying the quarterly estimates as you go along this year. Does that make sense?

^ My tax gal told me otherwise. I asked about the quarterly thing & she said not to do it unless I know for ure I'm gonna be making a lot of money, otherwise pay next year. Esp with this job, I never know when I'm gonna work so why pay out when I won't prob be making that much.

Aurora_Sunset
04-19-2017, 06:28 AM
^ My tax gal told me otherwise. I asked about the quarterly thing & she said not to do it unless I know for ure I'm gonna be making a lot of money, otherwise pay next year. Esp with this job, I never know when I'm gonna work so why pay out when I won't prob be making that much.

If you don't plan or don't think you'll be be making comparable to last year's salary (and in the adult industry, that can definitely be a possibility), yeah, sometimes it's smarter to not pay quarterly. Otherwise, you are essentially overpaying on your estimates with money you don't have. You'd actually get a tax return if you did do it, but if you aren't making much money, paying money on an overestimate could screw things up financially in the meantime. So I get that.

If you make a certain amount, they still expect some form of estimated payment quarterly though, even if you personally adjust it to be less than they think you should have been making. I didn't pay 4th quarter taxes this time around because I didn't make as much as last year, and yeah, I ended up not owing as much, but they still hit me with an underpayment penalty for not putting anything toward 4th quarter. The penalty is dependent on how much you owe, so if you don't make a lot, you won't get hit with a big penalty, but if you do end up owing quite a bit, that penalty could be in the 100s.

If you think your income will stay generally consistent or go up, you should start paying quarterly. If you really don't think you'll make much from camming at all, it's not the end of the world to not make quarterly payments, but if you make "enough," they'll have expected quarterly payments and can still penalize you for not doing them. (And I don't know what that "enough" threshold is. I owed about 2000 from my lack of 4th quarter payment and I got charged 30-some dollars for underpayment. But before I had entered in all the other quarters I had made payments on, they were tacking on a 300-some dollar penalty).

KatyBoleyn
04-19-2017, 08:22 AM
In the US, the "enough" threshold is if you owe at all for non-employer work. Through various tax credits and the like, most people in the lower income brackets won't actually owe (or owe that much anyways). Use the 1040ES worksheet to calculate it, or use Turbotax or another program to estimate them for you. If your tax gal is just guessing, they're doing it wrong.

Amaliestar
04-25-2017, 08:48 PM
So probably a long shot but wondering if anyone here are camming on international websites from Scandinavia, or more specifically, Norway? Countries around here usually have a high VAT percent (general rate of 25%) on most usual stuff with exception of a few things, like food and transport.

Of course registering as a business and paying/deducing VAT and TAX is the common approach, and I think I'll register a business soon regardless for the tax benefits itself.

There's however a few things I'm wondering about regarding the VAT in Norway though, things I'll probably bring to my local tax office later but thought I could throw it out here too.

Well about the VAT it seems to be about which country the revenue/sale/purchase happens in, but I'm not sure really which country it happens in, my website is .com, all content I sell is sold through other countries, but produced in Norway by me, and I'm the one who received (my share of) the money in the end of course, most to my Norwegian bank account, some on my Payoneer card.



If that doesn't apply and VAT is inevitable regardless there's still more to question, apparently I found something interesting in (which also reinstate the 'on domestic sales of goods and services' btw) where there's also another price rate for (public) broadcasting at 8% () instead of 25%.
This is under the same section as transport otherwise though so I have really no idea if this would even apply to camming lol.

Anyway these are all probably better questions for my local tax office, but if anyone here has been through similar any information/pointers are welcome :)

I got one more payment coming in before I have to start worry about the VAT after the 50k NOK limit as well, but it's getting there x)

starburst
05-03-2017, 06:15 AM
i have a weird question -

was sent a 5747c letter (need to verify my identity at a local IRS office.) the letter says I must bring in 2015/2016 tax returns and the accompanying documents that I used to file. because i am in daily pay, i never received a 1099 from them and added up my payments from my bank. do you think that is sufficient enough to bring with?

KatyBoleyn
05-03-2017, 09:54 AM
i have a weird question -

was sent a 5747c letter (need to verify my identity at a local IRS office.) the letter says I must bring in 2015/2016 tax returns and the accompanying documents that I used to file. because i am in daily pay, i never received a 1099 from them and added up my payments from my bank. do you think that is sufficient enough to bring with?

So long as you have your Schedule C and 1040 from those years, you should be fine.

starburst
05-03-2017, 03:51 PM
thank you kate! i was hoping it wouldn't be a big deal xD

Jupiter77
05-09-2017, 05:16 PM
I was wondering if it was true that we can deduct makeup and stuffs like that on taxes?

Magical_Hoohah
05-10-2017, 10:48 AM
^^ If you're American, not really. There's what's called the "housewife rule" which basically boils down to only being able to deduct things that would NOT reasonably be bought by a housewife/person that isn't engaged in any sort of work activities. The logic is that if a person doesn't work, they have no reason to need work supplies, so things that they would buy are clearly things that people buy for personal use, and therefore should be counted as a personal expense, not a business expense. Essentially, they don't want you deducting anything that a person could reasonably use in their personal life, regardless of whether you only use it for work.

Does a housewife/non-working person buy makeup? Yes, so you can't deduct it. Could a housewife/non-working person be reasonably expected to buy dildos and other sex toys? Yes (especially with the man away at work all the time, lol), so that's not really deductible either. It doesn't matter if you have a separate stash of makeup or dildos that only get used for work - it matters that those are things that a "civilian" COULD reasonably use in their private life, so they don't count.

On the other hand, you wouldn't expect a housewife to buy specialty theatrical makeup or novelty dildos literally the size of a fire hydrant, so that can be considered a business expense. If you buy panties and then sell them after customizing them, that becomes product inventory, and is deductible.

Of course, this is a pretty imperfect standard, because our ideas of what a housewife is and would buy differ quite a lot from one person to another. On top of that, plenty of non-working people still use ink pens and printer paper for personal shit, but office supplies are still deductible. They have more detailed explanations if you want to dig through IRS.gov and try to understand wtf they're talking about. Unfortunately, they are pretty stingy with this rule - a couple years ago, the IRS documents gave the example that self-employed painters can't deduct their painter's jumpsuits because people buy those in their private lives to paint their homes, too (I'd disagree. Most non-professionals paint in whatever crappy clothes they were going to throw away anyway... but I'm not the IRS).

Jupiter77
05-10-2017, 10:51 AM
^^ If you're American, not really. There's what's called the "housewife rule" which basically boils down to only being able to deduct things that would NOT reasonably be bought by a housewife/person that isn't engaged in any sort of work activities. The logic is that if a person doesn't work, they have no reason to need work supplies, so things that they would buy are clearly things that people buy for personal use, and therefore should be counted as a personal expense, not a business expense (regardless of how you choose to use them).

Does a housewife/non-working person buy makeup? Yes, so you can't deduct it. Could a housewife/non-working person be reasonably expected to buy dildos and other sex toys? Yes (especially with the man away at work all the time, lol), so that's not really deductible either. It doesn't matter if you have a separate stash of makeup or dildos that only get used for work - it matters that those are things that a reasonable person COULD use in their private life, so they don't count.

On the other hand, you wouldn't expect a housewife to buy specialty theatrical makeup or novelty dildos literally the size of a fire hydrant, so that can be considered a business expense. If you buy panties and then sell them after customizing them, that becomes product inventory, and is deductible.

Of course, this is a pretty imperfect standard, because our ideas of what a housewife is and would buy differ quite a lot from one person to another. On top of that, plenty of non-working people still use ink pens and printer paper for personal shit, but office supplies are still deductible. They have more detailed explanations if you want to dig through IRS.gov and try to understand wtf they're talking about.

I feel better about not saving all those receipts now.

Now I know if you work from home in some cases you can claim 30% of your rent and utilities. That true with us?

Magical_Hoohah
05-10-2017, 11:00 AM
Sort of - I think the % depends on the size of your home and how much of it you use. Also, the process for doing so is a little tricky, so best to consult an accountant. Your cam space has to be dedicated to business only. If it doubles as your bedroom/living room/gaming room/guest bedroom, then it doesn't count for any deduction.

Jupiter77
05-10-2017, 11:04 AM
Sort of - I think the % depends on the size of your home and how much of it you use. Also, the process for doing so is a little tricky, so best to consult an accountant. Your cam space has to be dedicated to business only. If it doubles as your bedroom/living room/gaming room/guest bedroom, then it doesn't count for any deduction.

I am very scared about taxes and I think an accountant is the way to go thanks!

Jupiter77
05-10-2017, 11:05 AM
I have a spare bedroom that I could "say" is my cam space but pretty much everything doubles as something.

KatyBoleyn
05-10-2017, 12:19 PM
I have a spare bedroom that I could "say" is my cam space but pretty much everything doubles as something.

Without saying anything you can take what's called the "standard" home/office deduction without worrying about room measurements or room usage. Its a small deduction, but its "safe". The only thing you need to prove in that case is that you work from home and its your primary place where you earn income.

Strippers that cam sometimes but earned the majority of their money in the club technically couldn't take this deduction, for example.

PinkPopcorn
06-04-2017, 10:03 AM
Why would anyone pay income tax who works for MFC? Idk about the other sites, but on MFC it clearly states that all tips/tokens are a gift. My accountant said that I don't have to pay taxes because all I receive is gifts in the form of tokens, gift cards, wishlists, etc. I don't actually receive money for a job. MFC has to pay tax because they sell the objects used as gifts, just like Amazon or whoever else, but it is a loop hole in the law. If you've been paying taxes and you are working for MFC you may want to check with your accountant or get another one. At first I didn't understand so I asked my attorney and he agreed with my accountant. Of course, I am in NY so maybe you have state rules that differ.

KatyBoleyn
06-04-2017, 02:50 PM
Why would anyone pay income tax who works for MFC? Idk about the other sites, but on MFC it clearly states that all tips/tokens are a gift. My accountant said that I don't have to pay taxes because all I receive is gifts in the form of tokens, gift cards, wishlists, etc. I don't actually receive money for a job. MFC has to pay tax because they sell the objects used as gifts, just like Amazon or whoever else, but it is a loop hole in the law. If you've been paying taxes and you are working for MFC you may want to check with your accountant or get another one. At first I didn't understand so I asked my attorney and he agreed with my accountant. Of course, I am in NY so maybe you have state rules that differ.

Your accountant and your attorney sound like utter morons - or this is a bad troll post. I would love it if you would drop me their details in a PM. They clearly didn't understand the legal construct behind any site's token system. By the same logic, money thrown at a stripper working the pole would be non-taxable as well...yeahhh. No. These two brainiacs did not just figure out that cammodels shouldn't have been paying taxes for the last 15-20 years.

You are employed by MFC as a contractor, receiving a portion of their sales in the form of direct commission, then tallied on a 1099 and issued to you. This commission is tabulated via their internal "token system" - none of which could remotely be considered a "gift" by the IRS. There are a few other angles to look at it, but all of them end up at the same place...you earned income as a self-employed person and owe tax on that income. There was a UK studio operator attempting to tell his models the same thing about MFC income, and they didn't take it too well. Such "knowledge" basically would make MFC a medium for tax-free money laundering, something they don't want to be associated with.

Let me be perfectly clear:

ANYTHING you receive in the course of your sex work, friendly "hosting", or adult entertainment career is TAXABLE INCOME. Everything. There are no exceptions I'm aware. If the answer to "Did you do it for money/rent/cars/clothes/other stuff?" is "Yes" then it is taxable at the market value of whatever you were given. If you don't want to pay taxes...have him put a ring on it.

starburst
06-05-2017, 04:19 PM
Why would anyone pay income tax who works for MFC? Idk about the other sites, but on MFC it clearly states that all tips/tokens are a gift. My accountant said that I don't have to pay taxes because all I receive is gifts in the form of tokens, gift cards, wishlists, etc. I don't actually receive money for a job. MFC has to pay tax because they sell the objects used as gifts, just like Amazon or whoever else, but it is a loop hole in the law. If you've been paying taxes and you are working for MFC you may want to check with your accountant or get another one. At first I didn't understand so I asked my attorney and he agreed with my accountant. Of course, I am in NY so maybe you have state rules that differ.


"If you've been paying taxes and you are working for MFC you may want to check with your accountant or get another one." - I do apologize, but it sounds like you are the one that needs another accountant.

"Of course, I am in NY so maybe you have state rules that differ." - The IRS will not like your logic because they couldn't careless where you live - income tax is income tax, it is a standard rate, and you are required to pay it.

MFC issues a 1099 Misc. The information given on the 1099 Misc goes into your Schedule C. You pay tax on Schedule C.

If you attempt to evade taxes by claiming everything you earn are "gifts," be aware that you'll likely find yourself getting audited in a few years when the IRS starts receiving your information and you have nothing to back it up.

KatyBoleyn
06-05-2017, 05:11 PM
There's just so much trollishly wrong with that post that I really doubt its a cammodel. "Just ignore your 1099 and tell the IRS you don't owe them," is not something an accountant would ever say, even if completely loaded...and that's just for starters.

There is so much bad tax info out there and its impossible to play whack-a-mole with it all. The problem is that this kind of misinformation will get someone hurt that didn't knowingly intend to break the law.

A tax lien is not a fun thing to have - it will mess up your future earnings. Employers don't want to deal with it (and you have to disclose felony tax evasion on applications). In the most extreme cases, federal jail time is not exactly fun either.

Not paying your taxes is an American past time, I get it. Put your big girl panties on and say, "I know its illegal and I choose to dodge or ignore my taxes." Do not pollute the public air waves with pretzel logic trying to justify why you're doing this or that...its that simple. Don't get mad at the people that pee on your Cheerios when your legal or accounting theories don't pan out. Its your life, your decision...just don't drag anyone else down with you.

If you accept money from "clients" in exchange for anything, that is income and it is taxable.

starburst
06-06-2017, 11:16 AM
And, in addition to KateBoleyn's post -

You can file and not pay your bill - You would just have to make arrangements with them and keep up with said arrangements. Seriously - filing truthfully will not hurt you. Evading your tax will. Even if you owe them a few grand, that is pennies to the IRS, and they will work with you.

ggminx
06-10-2017, 04:11 PM
I'm working on creating an offshore LLC to limit my tax liability in the US. I'm an American citizen but have been living abroad for almost a decade and have only been back twice for extremely short visits. I was just wondering how this works in relation to my camming accounts and clip accounts. I initially signed up and have been camming/selling clips from a whole bunch of accounts since 2014 (SM, CMD, C4S, etc.). How would I go about using the LLC instead of my personal identity? Like with SM, I signed up initially with my ID/passport. When I have my offshore LLC paperwork, how can I use it so that my LLC with them so my LLC is recording my income and my personal SSN isn't getting hit with it?

KatyBoleyn
06-10-2017, 06:13 PM
I'm working on creating an offshore LLC to limit my tax liability in the US. I'm an American citizen but have been living abroad for almost a decade and have only been back twice for extremely short visits. I was just wondering how this works in relation to my camming accounts and clip accounts. I initially signed up and have been camming/selling clips from a whole bunch of accounts since 2014 (SM, CMD, C4S, etc.). How would I go about using the LLC instead of my personal identity? Like with SM, I signed up initially with my ID/passport. When I have my offshore LLC paperwork, how can I use it so that my LLC with them so my LLC is recording my income and my personal SSN isn't getting hit with it?

If you are the sole proprietor (sole owner) then it makes absolutely no difference at all who gets credited with the money, as you're still one and the same person. You can just let your accountant know, and you can freely throw any income into any category (it all ultimately goes on your schedule C) and the IRS won't bat an eyelash so long as its all accounted. We still have some sites that issue 1099's in my personal name after years and its perfectly fine. The rules change considerably once you have one or more partners though, and/or employees.

If you're talking about a foreign corporation, that's outside my expertise.

For websites, most will need to re-create your account from scratch (such as Streamate) to change internally from SSN to EIN, but they can move all your things over. Some websites will ignore you entirely and you have to be persistent (CB, for example). CMD was painless, just ask Mark to update your tax info. C4S I have no idea, its still in my personal name.

Cam_Model_Jess
06-27-2017, 05:37 PM
No, its still income...its just counted for next year. Those services do report to the IRS.

Nothing you receive from a client is legally counted as a "gift". The IRS does not care if its your birthday, or even if you did nothing specific for it. There are 2 or 3 landmark cases on the subject (https://julianblocktaxexpert.com/articles/man-woman-money-taxes/) that I've posted further back in the thread. Another is the IRS whitepaper regarding gift cards, which are fully taxable income if received from clients or employers.

There's nothing wrong with getting clients to pay this year's tax bill, but the money they give does count as income for next year's taxes.

Katy, I remember you posting about paying taxes on gifts & my accountant says that I need to pay taxes on any amount over $25 per gift. So is a gift of $24.99 taxable? A gift of $25? A gift of $25.01? And if the gift is over that amount, do I just pay taxes on the amount over? (On a gift of $40 I would pay taxes on $15?) Also, can you link me to the page on the IRS website? All I can find is lots of rules about me giving gifts to others.

KatyBoleyn
06-27-2017, 06:28 PM
Katy, I remember you posting about paying taxes on gifts & my accountant says that I need to pay taxes on any amount over $25 per gift. So is a gift of $24.99 taxable? A gift of $25? A gift of $25.01? And if the gift is over that amount, do I just pay taxes on the amount over? (On a gift of $40 I would pay taxes on $15?) Also, can you link me to the page on the IRS website? All I can find is lots of rules about me giving gifts to others.

I'll try to find it, but the way we counted it when I worked for the CPA was anything cumulative over $25 was counted.
For example:

Client buys you something for $15 that year, but otherwise nothing else - feel free to ignore it.
Client buys you something for $20 and then something else for $30 - that would be $25 in income.
HOWEVER, you probably can make the case for something being "de minimus" and get away with a bit more (up to $100) if it was a one-time thing and wasn't done through a cash or gift certificate medium.

A "gift of cash" or "gift certificate" is always counted as income, no matter how much, and doesn't factor into gift values above. A further clarification was done in a white paper about gift cards being same as cash.

If you're looking specifically for IRS guidance on cammodels, you likely won't find any. I've posted a link to several landmark cases dealing with the subject several times as it pertains to older cases of prostitutes and sugar-babies - the principles covering income and taxation would be the same. Any basic rules governing and employer/employee relationship are generally applicable here. If you were dealing with the client through a big box site exclusively, the dynamic changes...but doing things one-on-one under the table means that your client can be construed as your employer.

The flipside is that any gift you give to them is also tax deductible - so if you're spending any money at all to give something to your fans its a business expense.

https://trustfile.avalara.com/blog/when-are-business-gifts-taxable/
http://www.jolanders.com/bookkeeping/tax-tips/Tax-Rules-for-Year-end-Bonuses--Holiday-Gifts-for-Employees_post_90.php#.WVMA7mjyuUk
https://www.irs.gov/publications/p15b/ar02.html#en_US_2013_publink1000193638


The rules can also change if they are giving you these gifts in serious "contemplation of marriage", or if you have some other personal relationship with them. If it ever goes to court, be expected to provide some evidence you took them to meet your mother at some point...take pictures.

Bottom line, never make the mistake of thinking your interpretation is what is going to count if it goes to court. You have to put yourself in the shoes of a stuffy IRS auditor and figure out how they will interpret the rules. Insofar as cammodel gifts, there's very few sets of rules that would remotely fit the situation, but "employee/employer" gift guidelines are the closest umbrella that will stretch over it.

Also keep in mind that they just aren't going to chase after you for a $30 bra from Victoria's Secret...they will nail you for a $500 hand bag and a $3000 diamond necklace though. They also know exactly how much went through your bank account as cash and most gift certificate exchanges if they want to pull the records to take a closer look.

The problem is that when we give general advice on forums, any tiny crack in the doorway gets interpreted as a Merry Christmas. If you have an accountant already, don't listen to us or anyone here. Accountants sign off on your stuff and are liable for anything they do in your name...you have some cover. They also know your specific tax situation better than we do, and some of them are happy to be cowboys with your money. If your "accountant" is some other random person in reality, they won't have a stake in what they're saying to you at all so play it safe. We've seen soooo many cases of fantasy accountants that seem to be giving the worst advice lately. We should have an article going up on our site soon pertaining to LLC's.

Cam_Model_Jess
06-27-2017, 06:44 PM
Thank you. The accountant is a by-the-books kind of guy, but I just couldn't find anything on the IRS site about gifts given to me that aren't money and which are given by a customer & not in exchange for services. I'm not looking to get out of anything; I just like being able to read about it. I'll look at the links you posted.

KatyBoleyn
06-27-2017, 07:04 PM
Thank you. The accountant is a by-the-books kind of guy, but I just couldn't find anything on the IRS site about gifts given to me that aren't money and which are given by a customer & not in exchange for services. I'm not looking to get out of anything; I just like being able to read about it. I'll look at the links you posted.

In that case, the IRS will be looking at the nature of the relationship and not necessarily doing line-items for each exchange with that person. There would be no way to prove anything in a legal sense. The nature of the relationship is a purely business one, ergo, any back and forth with goods, money, or services is purely business.

Rule #1 in camgirl taxes - there is no such thing as a "gift."

If you do invite him into your personal life (like you start dating or he goes to Thanksgiving at your mom's house with you), then the situation can get sticky and you might have some leeway.

https://julianblocktaxexpert.com/articles/man-woman-money-taxes/

This is probably the best link on the subject and will lead to the established case law if your accountant is interested:
http://www.leagle.com/decision/195585414hctcm840_1644/BLEVINS%20v.%20COMMISSIONER
http://www.leagle.com/decision/195716516agtcm149_1133/BRIZENDINE%20v.%20COMMISSIONER
http://www.leagle.com/decision/1977135936lqtcm1323_11031/JONES%20v.%20COMMISSIONER

Cam_Model_Jess
06-27-2017, 07:31 PM
Thanks. It's similar to a typical online relationship a camgirl & very generous customer would have, so I will look into the specifics on how to claim it. The accountant said just an entry for "other income" will be fine. But I thought it was only gifts over $25, so I'll have to go back & recalculate.

It does make me wonder though, if the IRS is going to say gifts from customers are income, then if I provide free services, can I put a value on that & deduct it from the amount of gifts he gave. It's all so weird when there are no specific codes.

KatyBoleyn
06-28-2017, 07:32 AM
Thanks. It's similar to a typical online relationship a camgirl & very generous customer would have, so I will look into the specifics on how to claim it. The accountant said just an entry for "other income" will be fine. But I thought it was only gifts over $25, so I'll have to go back & recalculate.

It does make me wonder though, if the IRS is going to say gifts from customers are income, then if I provide free services, can I put a value on that & deduct it from the amount of gifts he gave. It's all so weird when there are no specific codes.

Your accountant is absolutely correct, all you need to do is total up your gifts for the year and put it under "Other Income". It isn't any harder than that. I always separated out "cash and equivalent" and "physical goods" into two lines.

To completely solve that mess with Amazon being taxable, I only ever bought clearly work-related items (computer stuff, cameras, etc) with the cards in later years (and mostly refused to take them). That means it goes straight from taxable to tax-deductible.

Your labor or services are not deductible. The nature of your relationship is that of a business client primarily, so everything you do will be seen through that lens. No tax lawyer is going to sit down with you and sort every interaction or exchange of money into categories of "today I did it for the money, last Tuesday was for the lulz, last month it was because I was falling in love and did it for free, but he gave me $500 right after as a present, on my birthday he really spoiled me because he liked me, but he gets his money's worth..."

If that were a thing, the whole world would be soooo generous with their time and money and nobody would be taxable. The grocery store gifted me with milk and bread, so I was generous and gave them a present of $6...

Amaliestar
06-28-2017, 08:43 AM
Question about those 'gifts'; do you add the shipping price to that? If an item cost $15 and have another $15 in shipping that'd make it $30 on the papers?

KatyBoleyn
06-28-2017, 08:46 AM
Question about those 'gifts'; do you add the shipping price to that? If an item cost $15 and have another $15 in shipping that'd make it $30 on the papers?

I'd just put the value of the gift itself and wouldn't bother to add the shipping if he bought it directly for you.

If you received the gift card then that's the value...even if later the shipping cost is added to what you ordered.

If you're sending him something, then the shipping cost is a tax deductible business expense.

Cam_Model_Jess
06-28-2017, 11:23 AM
Your labor or services are not deductible. The nature of your relationship is that of a business client primarily, so everything you do will be seen through that lens. No tax lawyer is going to sit down with you and sort every interaction or exchange of money into categories of "today I did it for the money, last Tuesday was for the lulz, last month it was because I was falling in love and did it for free, but he gave me $500 right after as a present, on my birthday he really spoiled me because he liked me, but he gets his money's worth..."

Your answer seems a bit flippant, but maybe I'm reading into it too much. I'm not doing anything for "lulz" or falling in love. I'm running a business which I take quite seriously, and I know the IRS is serious, so I'm asking serious questions. If I normally bill $200 for a custom clip & I make a custom clip with a value of $200 for a client as a gift, then I was seriously asking if that falls into the category of a gift to a client. On the IRS site it says that I can deduct $25 for each gift given to a business associate (under certain circumstances). However, I understand your point that my "time" does not equal a gift. I was being serious in asking the question because if the IRS is going to view a customer as an employer when he gives me a gift, then it seems the IRS should view my gift to him as the opposite employer-employee/ business-client relationship. I understand though that it must be a tangible good. So if I send him a $200 physical gift, then I can claim the standard $25 per-gift deduction. I have purchased gifts for him, but I didn't keep receipts, so I will keep receipts in the future.

As a clip producer, I don't always deal in tangible goods, which is why I asked the question.

PinkPopcorn
06-28-2017, 11:25 AM
If someone buys you a car for $52,650 (that's retail, at least, not sure exactly what was paid with tax/dealer fees/etc) & someone else pays rent on your apartment ($4,300/month) but you do not have the money to cover income taxes on that, what do you do? It's more or less a gift, I don't do anything for this except online chatting and the occasional cam show (which is paid for in pvts on MFC). Other income is made through camming, but basically to cover general bills/fun things. Not trusting my current accountant too much after reading through this thread. I just don't want trouble. I am pretty new at the camming, only started like 2 years ago and thankfully haven't had any tax problems yet and I want to avoid them at all costs. Thank you so much for the time and effort you ladies put into this thread, I have a feeling you raised red flags for me just in time.

Cam_Model_Jess
06-28-2017, 11:28 AM
To completely solve that mess with Amazon being taxable, I only ever bought clearly work-related items (computer stuff, cameras, etc) with the cards in later years (and mostly refused to take them). That means it goes straight from taxable to tax-deductible.


Yes, my former accountant & I fought about this all the time. It was a mess on my books last year. So now I just claim all gift cards as cash income & spend them on personal items. All things which I purchase for business I purchase for myself with my business' money & not with gift cards. Because I have a business debit card which I use for business purchases. And my new accountant says that all gifts & gift card income must go on my personal income (schedule C). It would be a mess, I think, if I used gift cards to purchase business items unless I then remembered to put all of those items purchased on my schedule C rather than on my business taxes.

Cam_Model_Jess
06-28-2017, 11:32 AM
If someone buys you a car for $52,650 (that's retail, at least, not sure exactly what was paid with tax/dealer fees/etc) & someone else pays rent on your apartment ($4,300/month) but you do not have the money to cover income taxes on that, what do you do? It's more or less a gift, I don't do anything for this except online chatting and the occasional cam show (which is paid for in pvts on MFC). Other income is made through camming, but basically to cover general bills/fun things. Not trusting my current accountant too much after reading through this thread. I just don't want trouble. I am pretty new at the camming, only started like 2 years ago and thankfully haven't had any tax problems yet and I want to avoid them at all costs. Thank you so much for the time and effort you ladies put into this thread, I have a feeling you raised red flags for me just in time.

You have to pay taxes on the car & on the money given to you for rent. It's income. The person giving the gift is supposed to pay the taxes, but if he's not doing that, then you have to do it. That's if the relationship has nothing to do with work. What we're discussing right now is that since we're receiving all of these gifts because of our jobs in sex work, the gifts are considered income by the IRS. So you have to pay income tax on it.

And I'm not picking on you at all, but if someone is covering your rent, then you should be able to come up with the money for taxes because you don't have to pay rent. The tax will be 30% of your rent or less. It will increase your earnings by $4300/month & will increase your tax liability. But ask yourself: If the IRS audits you & asks why the paper trail shows that you're paying out way more than you're making, what will you say? Can you provide evidence to support that you're making enough money to pay $4300/month rent & you're also making enough money to support all your other purchase? Also, if the IRS asks why you're paying insurance premiums on a car, and the car registered to you is brand new, but there are no records of any car payments, what will you say?

KatyBoleyn
06-28-2017, 12:04 PM
Your answer seems a bit flippant, but maybe I'm reading into it too much. I'm not doing anything for "lulz" or falling in love. I'm running a business which I take quite seriously, and I know the IRS is serious, so I'm asking serious questions. If I normally bill $200 for a custom clip & I make a custom clip with a value of $200 for a client as a gift, then I was seriously asking if that falls into the category of a gift to a client. On the IRS site it says that I can deduct $25 for each gift given to a business associate (under certain circumstances). However, I understand your point that my "time" does not equal a gift. I was being serious in asking the question because if the IRS is going to view a customer as an employer when he gives me a gift, then it seems the IRS should view my gift to him as the opposite employer-employee/ business-client relationship. I understand though that it must be a tangible good. So if I send him a $200 physical gift, then I can claim the standard $25 per-gift deduction. I have purchased gifts for him, but I didn't keep receipts, so I will keep receipts in the future.

As a clip producer, I don't always deal in tangible goods, which is why I asked the question.

In that case, you theoretically could deduct your expenses incurred in making that clip, such as if any props were destroyed or your price for physical medium (such as if you burned it to a DVD and gave it to him).

Otherwise, its really just your time and depreciation on your equipment which is already accounted. I can't see any normal circumstance where the fair market value of anything expended in making a bonus video and giving it to him online would exceed $25.


Yes, my former accountant & I fought about this all the time. It was a mess on my books last year. So now I just claim all gift cards as cash income & spend them on personal items. All things which I purchase for business I purchase for myself with my business' money & not with gift cards. Because I have a business debit card which I use for business purchases. And my new accountant says that all gifts & gift card income must go on my personal income (schedule C). It would be a mess, I think, if I used gift cards to purchase business items unless I then remembered to put all of those items purchased on my schedule C rather than on my business taxes.

Your schedule C is your business taxes in most cases, there's no difference. So long as everything is accounted somewhere, the IRS makes little or no distinction who is credited - you as a business or you as a person. It all goes on the same schedule C. If you are the only owner of the business, you are your business. There are exceptions, such as if you were set up as a C-Corp or S-Corp, but most cammodels have absolutely no need to do that.

That being said, it is still good practice to keep the books separated. It means the accountant (or you) will have a much easier time at the end of the year. It also means the IRS will see a very clean set of books if they ever come into question.

What I was talking about was avoiding paying surprise taxes on gift card income...so long as you turn around and spend those cards 100% on valid expenses, it all evens out and you effectively pay no taxes. One year I was bad and took about $3000 in gift card income, and that was a very nasty surprise when we calculated the tax bill. Next year, it was "no gift cards!" and if they did send one anyways it all went to computer hardware.


If someone buys you a car for $52,650 (that's retail, at least, not sure exactly what was paid with tax/dealer fees/etc) & someone else pays rent on your apartment ($4,300/month) but you do not have the money to cover income taxes on that, what do you do? It's more or less a gift, I don't do anything for this except online chatting and the occasional cam show (which is paid for in pvts on MFC). Other income is made through camming, but basically to cover general bills/fun things...

This question does come up a lot also. I always recommend if they're giving you something, they should give a bit more to cover the taxes also...point that out to your benefactors :) If they are in a "serious relationship" with you, then they can do a gift tax on it that they pay (and you need to make damned sure they did). Otherwise, you are on the hook for that extra 20-30% of the value of what they gave you...and for that they can be just a bit more generous.

Cam_Model_Jess
06-28-2017, 12:55 PM
Your schedule C is your business taxes in most cases, there's no difference. So long as everything is accounted somewhere, the IRS makes little or no distinction who is credited - you as a business or you as a person. It all goes on the same schedule C. If you are the only owner of the business, you are your business. There are exceptions, such as if you were set up as a C-Corp or S-Corp, but most cammodels have absolutely no need to do that.

I am a two-member (50/50) LLC with an S-corp election, so I do keep everything separate. I am my own employee essentially. When I was just camming, filing as a sole proprietor was fine. Now that I hire models for my video productions & my overhead is pretty high (up to 50% some months), an S-corp election made sense for my business in terms of tax percentages. However, you're right in that it's probably not very common for someone who is only camming or making some clips on the side. I didn't expect answers specific to my business structure, and I appreciate whatever answers you've given, but I thought I should clarify my response to the "Amazon" issue. Separate books for personal income & business income are necessary in this case, as my husband (the other 50% of my business) isn't receiving the gifts & they weren't given to my company.

kendallkushxo
08-14-2017, 01:21 PM
Reading All of this is making my head spin! I did my taxes last year for the first time on turbotax and it was super simple and easy. I got like 2k back.

A tax person told me I could deduct all my toys but people on here are saying you cant because of house wife tax? I was never told about this and I'm really confused. Does anyone know the specific toys that can and can't be deducted?

KatyBoleyn
08-14-2017, 05:28 PM
The basic rule is "anything that a housewife would reasonably use". This leaves a lot of room for interpretation. The problem is that its not going to be YOUR interpretation, but that of an IRS agent and/or a judge in a tax case should you ever go to audit. You should decide if saving $5 to $10 off your tax bill is worth the (albeit small) potential for having a very embarrassing matter of public record put on display.

For our own advisement, anything that basically only a "sex performer" would be using would be deductible. Standard vibrators/dildos...no. Monster props for insertions or interactive vibes like Lovense...yes.

mishimishi
08-28-2017, 11:00 AM
instead of making tax installments is it possible to just pay all my taxes in one lump sum at the end of the year? Ive heard some people do this but not sure if its true and allowed and I heard you can get penalties for not doing it the installment way, are the penalties harsh?

Ide much rather pay in lump sum
(ps im from b.c canada)

KatyBoleyn
08-28-2017, 03:17 PM
instead of making tax installments is it possible to just pay all my taxes in one lump sum at the end of the year? Ive heard some people do this but not sure if its true and allowed and I heard you can get penalties for not doing it the installment way, are the penalties harsh?

Ide much rather pay in lump sum
(ps im from b.c canada)

I have no idea with Canadian taxes.

In the U.S., if its determined that you need to file quarterly, you must file quarterly. You have the option of paying all quarterly installments up front so you can get it out of the way and not worry until annual tax filing time. Many people/businesses carry their tax return money over like this - Just say you want to apply your return to next year's taxes and it will reduce or eliminate your quarterly tax filings.

HollyJaydeXXX
10-10-2017, 01:23 PM
Hey Dolls, can anyone tell me if the $5 immediate load fees for Payoneer/First Choice Pay can be written off? Just realized I spent hundreds this year in Payoneer load fees

grneyesnfl
10-10-2017, 01:43 PM
In the U.S., if its determined that you need to file quarterly, you must file quarterly.

That's incorrect. There are plenty of self-employed people who do not pay quarterly taxes like they're supposed to, but instead pay them in one lump sum when they file their taxes. By not paying them according to the quarterly tax schedule, though, they are subjected to penalties and interest on that amount.

PhatGirlDynomite!!!
10-10-2017, 03:29 PM
Hey Dolls, can anyone tell me if the $5 immediate load fees for Payoneer/First Choice Pay can be written off? Just realized I spent hundreds this year in Payoneer load fees

That is an excellent question!!! Ive never thought about that before and will definitely look into that.

HollyJaydeXXX
10-10-2017, 03:32 PM
That is an excellent question!!! Ive never thought about that before and will definitely look into that.

Thanks Doll! It's a cost of doing business, right? Very curious...

KatyBoleyn
10-11-2017, 01:28 PM
That's incorrect. There are plenty of self-employed people who do not pay quarterly taxes like they're supposed to, but instead pay them in one lump sum when they file their taxes. By not paying them according to the quarterly tax schedule, though, they are subjected to penalties and interest on that amount.

When I say "must", it means you should do something according to the rules to avoid hassles like penalties, interest, debt collection, audits, jail time, etc. You're free of course not to do anything you wish.


Hey Dolls, can anyone tell me if the $5 immediate load fees for Payoneer/First Choice Pay can be written off? Just realized I spent hundreds this year in Payoneer load fees

Yes they absolutely can, so long as you're paying it on your side.

For example, Streamate charges you a fee for FedExing your check or making a wire. This is already deducted from the amount shown on your 1099, so you don't get to "double-dip".

Payoneer/FC charges you directly fees after you've been paid. These are a fully deductible business expense.

heyho
10-25-2017, 05:16 AM
How much does an accountant's services cost? I'm looking at getting one but a bunch of the chartered accountant company websites list "sole trader / small business" accounting packages for a weekly fee, which...$58 every week just for an accountant to do my tax once a year, that seems like a lot to me. Is this normal?

Magical_Hoohah
10-25-2017, 02:48 PM
^^If you only use the accountant once a year, you should only be paying once a year. That is how most people do it, and when people talk about "my accountant," they mean that they have the same guy do their taxes every year. It's like, you "have a gynecologist," but you probably only see her and pay her yearly. For accountants January-April is called tax season, and a lot of them work a ton of overtime because that's the only time they see the vast majority of their clients. You don't need to keep them on a retainer unless you need a lot of ongoing money management.

minniesoporno
11-04-2017, 10:21 AM
I learned something of how I've been handling my taxes and money lately. for many years everything was being filed under my legal name and as to the Canadian government as other income and I would write off the expenses that came with having other income. which completely fine to do I might be doing that for the next 3 years or so depending on annual income.


the government calls is other income/ box 20. Now that my business is shifting and what I am doing to make money online is growing I am thinking to register my business name and have all my internet income go under my business then give me "my legal name" a salary. If its even possible.

No only do I have to worry about giving myself EI, CPP, I also have to save for retirement and also create an investment portfolio which means not only will I have and I do have a financial planner I will also need an accountant. and some how this is all suppose to work together so when I am old and grey I have some money left over to enjoy my "golden years"

It's been a lot of changing my mindset around money, and accepting and embracing the fact its perfectly fine to take care of myself financially whatever crazy things I want to do with my money. some how I felt guilt around money so I wouldn't push myself to make money so save. but that has to change I've sabotage myself and my life enough.

PinkPopcorn
11-04-2017, 10:46 AM
How much does an accountant's services cost? I'm looking at getting one but a bunch of the chartered accountant company websites list "sole trader / small business" accounting packages for a weekly fee, which...$58 every week just for an accountant to do my tax once a year, that seems like a lot to me. Is this normal?

They are probably offering tax services on a weekly basis for people who run businesses and are required to file monthly sales tax and pay taxes quarterly.

Mistress Anika
11-04-2017, 01:33 PM
@minnie You may want to look into contacting a financial planner (maybe accountants do that too idk) but someone that helps you figure out how all those bits & pieces work together and set up your future.

Mistress Anika
11-04-2017, 01:50 PM
How much does an accountant's services cost? I'm looking at getting one but a bunch of the chartered accountant company websites list "sole trader / small business" accounting packages for a weekly fee, which...$58 every week just for an accountant to do my tax once a year, that seems like a lot to me. Is this normal?

I'm not sure where your located or how many different income sources you have but in general, your basic camgirl/clip maker with or without a vanilla paycheck on the side should be able to handle her (or his) own taxes prep (using turbo tax or one of the other programs available)

I know the task seems scary the first time around & spending a few hours with a tax professional, discussing things that can & cant be write-offs may be valuable but I couldn't imagine paying weekly for someone to do my "accounts." I'm not doing payroll or billing a high volume of clients each month. The hour or so a week I spend "keeping my books" wouldn't justify handing that task to someone else.

My Recomenddations are as follows:

Get a copy of Quicken - Paid Software, Check if your bank works with it
Open a new Bank Account (Checking & Savings) I have a personal bank account at 2 banks but you may be able to open two at the same bank
Send all your Cam/Clip/1099 Income to NEW Checking Account
Each time a site pays you, move 30% (depending on your tax rate, maybe more or less) Into your NEW Savings account
- This is your TAX Savings fund. Pretend this money doesn't exist until its time to pay taxes (Quarterly or the end of the year)
I leave 10/15% of my 1099 income in my NEW Checking account - Estimate your business expenses.
The remaining 55/60% of my income gets transferred/Paid to my Second Bank Checking account
Second Bank Checking is where I pay my personal savings & pay all my bills. (If you have a W9 paycheck job, send it to this account as well)

Quicken tracks all my income/purchases etc. I can see how much I've made (deposited) from C4S, MV, or wherever. I can see how much I've spent on postage (mailing care packages or panties) how much my website & subscriptions services are costing me. Quicken also has all the itemized tax categories (US) so that when I at tax time everything is all conveniently laid out & ready to plug into the Independent contractor / small business versions of a Tax program.

By using two complete accounts I can't easily spend money earmarked for taxes or web hosting.