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Thread: Help me out here...

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    Default Help me out here...

    Ok, so this year I will be dancing full time. I have a few questions. Please answer as simple as possible.

    ~When I do my taxes, what do I tell them my title is?
    ~How much should I tell them I make?
    ~Do I have to show them all of my reciepts?
    ~Renting a place, what do I tell the landlord?

    ~And how much tax money am I suppose to give back/put away on each shift? This is the part that confuses me the most!

    ~What if I travel, or dance in another state...do I have to pay taxes in the state I live in & travel to as well?

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    Banned Melonie's Avatar
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    Default Re: Help me out here...

    objective answers ...

    #1 - the IRS issues a list of sole proprietor business occupation codes. The one that comes closest to describing exotic dancing is 'performer'

    #2 - by law, the actual amount you earned

    #3 - only if you are audited

    #4 - tell him you have three months rent in cash !

    #5 - this depends on a number of factors, among them whether you are single or married, whether you have children, your total expected annual earnings, the tax rates which apply in your home state etc. Wild guesswork for a single full time dancer with no children who is not a homeowner, and earning an average of $2000 per week ...

    - Social Security / medicare tax = 15.3% or $ 306 per week
    - federal income tax = 28% or $560 per week
    - NY or CA sized state income tax = 7% or $140 per week
    total tax burden 50% or about $1000 per week

    #6 - yes you have to file tax returns in every state you work in that has an income tax. However, you also get a counterbalancing credit against income taxes owed to your home state.

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    Default Re: Help me out here...

    Quote Originally Posted by Melonie View Post
    objective answers ...

    #5 - this depends on a number of factors, among them whether you are single or married, whether you have children, your total expected annual earnings, the tax rates which apply in your home state etc. Wild guesswork for a single full time dancer with no children who is not a homeowner, and earning an average of $2000 per week ...

    - Social Security / medicare tax = 15.3% or $ 306 per week
    - federal income tax = 28% or $560 per week
    - NY or CA sized state income tax = 7% or $140 per week
    total tax burden 50% or about $1000 per week
    Are those the percentage rates regardless of the amount earned? Also, what is considered a tax write off? I mean, assuming I have receipts, are clothes and shoes a write off? Its not like I wear that stuff out, its only to perform in.

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    Banned Melonie's Avatar
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    Default Re: Help me out here...

    ^^^ obviously the tax rates depend on the factors I stated - annual income levels, marital status, available tax deductions like home mortgage interest, number of dependents, available tax write-offs like dancer outfits and shoes. Also, much depends on what Obama / Washington decides to do (or not do) regarding existing income tax rates ( specifically, the AMT, which will directly impact a single person earning $100k per year, and with a one year temporary 'fix' set to expire at the end of this month ).

    For 2009 income, the 25% federal tax bracket starts at $67.900 and the 28% federal tax bracket starts at $82,250 for a single person with no dependents. The 15.3% Social Security & medicare tax rate stays the same regardless of income (up to a $100k per year income anyhow). State and local income tax rates all have their own percentage brackets and their own annual income thresholds. Personal and 'business' tax deductions also vary widely. So yes it is possible that one person with a $100k annual income may only have an effective overall tax rate of 35%. However, another person with a $100k annual income may have an effective overall tax rate of closer to 50%.

    lots of nitty gritty details can be found at

    Not wanting to get too political in Dollar Den, but for a fact a single person who earns $100k+ per year, i.e. a full time 'professional' dancer, is now considered to be 'rich' by many federal, state and local gov't officials. These are the same gov't officials who are now becoming frantic about trying to find enough tax revenues to continue to pay for all the extra money the gov't is now spending on unemployment benefits, social welfare benefits, economic stimulus programs etc. Thus the probability is that the effective overall tax rate applying to such a person will be increasing rather than decreasing. For example, California state legislators just passed a deficit reduction budget that would increase California state income tax rates significantly, which the governor has threatened to veto. So far New York has attempted to increase tax revenues by taxing soft drinks, gasoline, cigarettes & alcohol etc. without messing with income tax rates.

    In a nutshell, nobody is really sure how the tax rate (increase) issue will work out by the end of 2009. But what IS pretty sure is that the gov't will stand to gain the most tax revenues with the least political flak by attempting to increase taxes on the 'rich' ... and as a single person with no dependents and a $100k income, the gov't considers you to be 'rich' !!! Because of these unknowns, IMHO it's better to set aside too much money throughout the year in 2009 and get a tax refund in April 2010 than to set aside too little money throughout the year in 2009 and find yourself $10-15-$20,000 'short' when April 2010 rolls around.

    ~
    Last edited by Melonie; 12-18-2008 at 11:10 PM.

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    Senior Member Butrcup98's Avatar
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    Default Re: Help me out here...

    I suggest hiring an accountant and letting them deal with it. I pay less than $300 and he does my and my husband's taxes.

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    Default Re: Help me out here...

    the thing is... how much am i suppose to tell the accountant i make in a year... when the earnings can be different each night i work?


    here is another question. i have horrible credit. i mean fucked. will landlord's check out my credit history?

    sorry for all these questions, but i'm going to be doing some major changes that i've never dealt with before.

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    Banned Melonie's Avatar
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    Default Re: Help me out here...

    i have horrible credit. i mean fucked. will landlord's check out my credit history?
    if the landlord is part of a corporate entity like a big apartment building, then yes a credit check will be run. However, if the landlord is a little old lady with a second floor apartment to rent, then probably no credit check.


    how much am i suppose to tell the accountant i make in a year
    you don't need to involve the accountant until after you have been dancing full time for quite a while. In the meantime you can simply send in estimated tax payments every quarter to the IRS and state income tax agencies based on your actual net income from the previous 13 weeks.

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    God/dess threlayer's Avatar
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    Default Re: Help me out here...

    Don't forget the business deductions you take out pre-tax (in your Schedule C against your self-employment income). That directly reduces both income and SS taxes. It's worth studying and asking about. The more you know about taxes, the less taxes you pay.
    I loved going to strip clubs; I actually made some friends there. Now things are different for the clubs and for me. As a result I am not as happy.

    Customers are not entitled to grope, disrespect, or rob strippers. This is their job, not their hobby, and they all need income. Clubs are not just some erotic show for guys to view while drinking.

    NOTE: anything I post here, outside of a direct quote, is my opinion only, which I am entitled to. Take it for what you estimate it is worth.

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    Senior Member Butrcup98's Avatar
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    Default Re: Help me out here...

    I still suggest hiring an accountant. After reading your questions you do seem completely lost about the whole tax subject.

    You tell the accountant that you make whatever you want. Legally, you have to report everything. Technically, you only have to report what the government can trace. This includes all bank accounts, credit cards, cd's, etc. Also, you should claim enough to cover the payment of all your monthly bills (EVEN IF YOU PAY THEM BY MONEY ORDER), plus a little extra.

    On average, since I'm a novice at taxes and don't have the time to learn it all, by hiring an accountant I save 16+ hours and several thousand dollars in taxes.

    As far as your business deductions: If you claim it, you must also claim the income used to pay for it. So, if you pay cash for a lot of items like clothes etc, then skip claiming them. Only claim what you pay for with the money you already claimed on your 1040.

    One great deduction is mileage. Record ALL of the miles that you drive to and from work. I even claim the mileage to and from my bank. I saved $10K in taxes last year because of this deduction. But I work an hour from my job.

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    God/dess threlayer's Avatar
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    Default Re: Help me out here...

    Lets say you save $4000 for 16 hours work. That's worth $250/hour. And you can get that done by a tax preparer for say $250 or one-fifteenth the time you'd spend on it. What a deal. For the first year. But after 10 years of essentially the same procedures, you spent $2500 or more. For 16 hours of work the first year and maybe 4 hours subsequent years +$60 for a tax program. But with your own knowledge, you could save more by structuring your expenses. I guess you could call it a toss-up, maybe.
    I loved going to strip clubs; I actually made some friends there. Now things are different for the clubs and for me. As a result I am not as happy.

    Customers are not entitled to grope, disrespect, or rob strippers. This is their job, not their hobby, and they all need income. Clubs are not just some erotic show for guys to view while drinking.

    NOTE: anything I post here, outside of a direct quote, is my opinion only, which I am entitled to. Take it for what you estimate it is worth.

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    Banned Melonie's Avatar
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    Default Re: Help me out here...

    while everyone is entitled to their own opinion, the IRS does have 'official opinions' from tax court judges. Some of those 'official opinions' are ..

    - that mileage deductions for travel between your home and your primary place of business are NOT legitimate business expense tax deductions. Only mileage between a primary place of business and other places of business count as business travel. The one exception is a 'road trip' where the distance between your home and the club is in excess of 100 miles, and where an overnight stay is necessary. If audited, the IRS will want to see hotel receipts !

    - that all deductions for costumes, shoes, makeup, tanning, hair salon etc. are subject to a 'housewife test'. If a regular housewife would buy the item with no obvious business purpose then the IRS will claim the expenses are for personal use / benefit and thus not deductible as a business expense.

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    God/dess Zofia's Avatar
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    Default Re: Help me out here...

    Quote Originally Posted by Melonie View Post
    ...The 15.3% Social Security [FICA] and medicare tax rate stays the same regardless of income (up to a $100k per year income anyhow).
    While the FICA and Medicare tax rate is 15.3%, you only pay it on 92.35% of your schedule C income. That is to take into account the fact that the employer's portion is a deduction. Thus if your schedule C income is $100,000 you only pay $14,130 for FICA and Medicare. For an estimator see http://www.finance.cch.com/sohoApple...Employment.asp

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    God/dess threlayer's Avatar
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    Default Re: Help me out here...

    If a dancer is indeed an independent contractor, they are free-lancing and need to find work at places that need them, and those are always temporary. That allows them to have as their headquarters, i.e. where they have their office, any place they want, such as their home, but not at the club. That has to be a dedicated place in their home (see IRS rules) or other building. If it passes that home office test and they are actually independent contractors, eg the worker makes calls to get work, even though they work in a different location, then all mileage between their headquarters and the clubs they work at would be deductible.

    Most of the clothing I see dancers wear I ONLY wish the average/regular 'housewife' would/could wear. Makeup, etc will not be any different than that professional actors are entitled to. If a regular housewife would buy these items to wear in public, you can believe they may well have a 'business purpose,' just not one a typical husband woud approve of. And certainly not everyday.
    I loved going to strip clubs; I actually made some friends there. Now things are different for the clubs and for me. As a result I am not as happy.

    Customers are not entitled to grope, disrespect, or rob strippers. This is their job, not their hobby, and they all need income. Clubs are not just some erotic show for guys to view while drinking.

    NOTE: anything I post here, outside of a direct quote, is my opinion only, which I am entitled to. Take it for what you estimate it is worth.

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    God/dess Zofia's Avatar
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    Thumbs up Re: Help me out here...

    Quote Originally Posted by threlayer View Post
    If a dancer is indeed an independent contractor, they are free-lancing and need to find work at places that need them, and those are always temporary. That allows them to have as their headquarters, i.e. where they have their office, any place they want, such as their home, but not at the club. That has to be a dedicated place in their home (see IRS rules) or other building. If it passes that home office test and they are actually independent contractors, eg the worker makes calls to get work, even though they work in a different location, then all mileage between their headquarters and the clubs they work at would be deductible.
    The service would definitely agree with your interpritation of the mileage rules. To complicate matters slightly let's consider the "house" dancer who works at one club for thirty (30) weeks a year. She goes on the road for ten (10) weeks a year, sometimes for a couple of weeks at a time, others, for just a long weekend. She takes the other twelve (12) weeks and hangs at the beach, not dancing at all. I don't think that schedule would convert the commuting expenses for the trips to the "house" club for thirty (30) weeks into deductible mileage. However, for the ten (10) weeks she goes on the road, that is definitely deductible.

    Most of the clothing I see dancers wear I ONLY wish the average/regular 'housewife' would/could wear. Makeup, etc will not be any different than that professional actors are entitled to. If a regular housewife would buy these items to wear in public, you can believe they may well have a 'business purpose,' just not one a typical husband woud approve of. And certainly not everyday.
    Some of the stuff I wear for my BF when he comes home from a long road trip might qualify!

    HTH
    Z

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    Banned Melonie's Avatar
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    Default Re: Help me out here...

    I don't think that schedule would convert the commuting expenses for the trips to the "house" club for thirty (30) weeks into deductible mileage. However, for the ten (10) weeks she goes on the road, that is definitely deductible.
    yes exactly. And based on the results of a couple of audits I know of, the IRS auditor will be looking for hotel/motel receipts to go along with the mileage deductions.


    That is to take into account the fact that the employer's portion is a deduction. Thus if your schedule C income is $100,000 you only pay $14,130 for FICA and Medicare
    yes this is the 'nitty gritty' of the Social Security + medicare tax situation for self-employed persons. In the grand scheme of things though, it still represents an SSI effective tax rate of 14.1% versus the 15.3% plain vanilla example i.e. a 1% savings versus a 40%-50% effective overall tax rate (depending on the income tax rate of the state / city the dancer lives in).
    Last edited by Melonie; 12-21-2008 at 06:17 AM.

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    God/dess Zofia's Avatar
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    Default Re: Help me out here...

    Quote Originally Posted by Melonie View Post
    yes exactly. And based on the results of a couple of audits I know of, the IRS auditor will be looking for hotel/motel receipts to go along with the mileage deductions.
    Before looking at expenses the service looks for income. No schedule C income and the service will be very suspicious. However, let's assume there is reported schedule C income. The next thing the service would want to see is a business purpose to the trip. The easiest way to show a business purpose is revenue from that particular trip. Thus, if the dancer can say, "I drove to Lousiville, eighty miles from my home, to dance one night and took $1,000 home that night" the service will have no problem allowing 160 miles of expense. The key is what the service calls contemporaneous records. The better records you have and the closer in time to the event you make the record, the better from the service' perspective. Thus my recommendation is to actually keep books. Record your expenses and revenues daily. All real businesses keep contemporaneous records.

    HTH
    Z

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    God/dess threlayer's Avatar
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    Default Re: Help me out here...

    The 'house' dancer being an employee, I assume.

    I agree that keeping contemporaneous records can gain your claim a lot of credibility with the IRS, as well as knowing the regulations, if you are ever directly asked (audited). Responsible businesses keep good records and they assume a lot of truthfulness if you've bothered to take that trouble. They also like it a lot when the numbers balance.
    I loved going to strip clubs; I actually made some friends there. Now things are different for the clubs and for me. As a result I am not as happy.

    Customers are not entitled to grope, disrespect, or rob strippers. This is their job, not their hobby, and they all need income. Clubs are not just some erotic show for guys to view while drinking.

    NOTE: anything I post here, outside of a direct quote, is my opinion only, which I am entitled to. Take it for what you estimate it is worth.

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    Banned Melonie's Avatar
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    Default Re: Help me out here...

    The 'house' dancer being an employee, I assume
    not necessarily ! The pertinent point actually boils down to whether or not the IRS considers the home to 'place of work' trip to be a commute or not, regardless of the dancer being an 'independent contractor' business owner. If the distance is less than 100 miles, and if no overnight stay is involved, odds are that the IRS will consider this travel to be a non-deductible commute.

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    Default Re: Help me out here...

    Quote Originally Posted by Butrcup98 View Post
    I still suggest hiring an accountant. After reading your questions you do seem completely lost about the whole tax subject.

    You tell the accountant that you make whatever you want. Legally, you have to report everything. Technically, you only have to report what the government can trace. This includes all bank accounts, credit cards, cd's, etc. Also, you should claim enough to cover the payment of all your monthly bills (EVEN IF YOU PAY THEM BY MONEY ORDER), plus a little extra.

    On average, since I'm a novice at taxes and don't have the time to learn it all, by hiring an accountant I save 16+ hours and several thousand dollars in taxes.

    As far as your business deductions: If you claim it, you must also claim the income used to pay for it. So, if you pay cash for a lot of items like clothes etc, then skip claiming them. Only claim what you pay for with the money you already claimed on your 1040.

    One great deduction is mileage. Record ALL of the miles that you drive to and from work. I even claim the mileage to and from my bank. I saved $10K in taxes last year because of this deduction. But I work an hour from my job.
    So you don't have to claim everything? I was wondering what if I saved some money at home, can I get busted?

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    Banned Melonie's Avatar
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    Default Re: Help me out here...

    ^^^ all I am going to say is this ...

    - by law all dancers are required to report their actual incomes

    - by various automatic reporting methods on expenditures ... i.e. state motor vehicle departments, state real estate title departments, bank / investment / retirement account interest / dividend statements, college bursar's office tuition payments, cash transaction reports generated by retailers when a purchase is made exceeding a certain threshold ... in addition to a local cost of living database for every zip code in the USA ... the IRS and state tax dep'ts have a reasonable idea of how much money a person with social security # XYZ is spending. Obviously, the IRS and state tax departments run automated computer cross-checks to try and verify that a tax return exists under the same social security # XYZ declaring an amount of income that is sufficient to explain how all of the automatically reported expenditures were possible.

    From a probability standpoint, it is probably true that if a dancer did not own a home, did not have a car registered, did not have a bank / investment account which earned a significant amount of interest / dividends, did not pay out a substantial amount of money in college tuition etc. , that the IRS is not going to come 'looking' for discrepancies. But random audits do happen. So do targeted audits of dancers as the result of their club getting into financial / tax trouble (recent example SCORES). So do targeted audits of dancers who, after declaring little income on previous years tax returns, suddenly 'find' enough money to spend tens of thousands of dollars on a car or a house or college tuition or a large bank / investment / retirement account !

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    God/dess threlayer's Avatar
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    Default Re: Help me out here...

    You'd have to get paid always in cash and make cash payments for most everything before you aren't in the eyes of Big Brother. Or get someone else to pay your bills, which are small compared to theirs.
    I loved going to strip clubs; I actually made some friends there. Now things are different for the clubs and for me. As a result I am not as happy.

    Customers are not entitled to grope, disrespect, or rob strippers. This is their job, not their hobby, and they all need income. Clubs are not just some erotic show for guys to view while drinking.

    NOTE: anything I post here, outside of a direct quote, is my opinion only, which I am entitled to. Take it for what you estimate it is worth.

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    God/dess Zofia's Avatar
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    Default Re: Help me out here...

    Quote Originally Posted by threlayer View Post
    The 'house' dancer being an employee, I assume.
    The IRS presumes that everyone is an employee. The burden, and it is a tough one to meet, is on the taxpayer to prove she is not an employee. This is the case even when the employer does not withhold or treat the person as an employee. For the taxpayer to prevail on the employee/independent contractor issue is fact specific although the service has guidance on the matter. Also there are some reported decisions that can be helpful. Still, for most dancers, they really are employees even if the club says otherwise.

    One of the best things a dancer can do if she really wants to be an independent contractor is obtain a taxpayer identification number, TPIN. Next, she needs to start filing taxes using that TPIN. She needs to give that TPIN to clubs. Businesses never use a social security number. She also needs to file with her state, creating a proprietorship if nothing else. Better yet, a LLC, PLLC (if allowed under state law) or a corporation or professional services corporation and make the sub-chapter S election.

    HTH
    Z

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    Default Re: Help me out here...

    If you treat your clubs as business clients rather than a place to go to work, then you get the general idea. There is an IRS questionaire (set of questions) that can help with that determination. And if you are, this can give you some independence from onerous club management because control is the criterion for independence.

    Maybe it depends on the state but proprietorship licenses can often be obtained by applying to the County Clerk's office and paying a small fee (like $35 or so).
    Last edited by threlayer; 12-24-2008 at 09:33 AM. Reason: tyops again
    I loved going to strip clubs; I actually made some friends there. Now things are different for the clubs and for me. As a result I am not as happy.

    Customers are not entitled to grope, disrespect, or rob strippers. This is their job, not their hobby, and they all need income. Clubs are not just some erotic show for guys to view while drinking.

    NOTE: anything I post here, outside of a direct quote, is my opinion only, which I am entitled to. Take it for what you estimate it is worth.

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