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Thread: Is it important to find an accountant that has expierence with doing dancers' taxes?

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    Default Is it important to find an accountant that has expierence with doing dancers' taxes?

    Hi,

    I tried dancing for 2 weeks in August. Then had to stop for a family emergency. I'm planning to start dancing again. But this time is for a long time, til I save up some money. I don't want to get in any type of troubles in the future. I researched a bit online about being an independent contractor for dancers. BUT I'm a complete dummy when it comes to taxes. I never did taxes before, as I was in school fulltime and never really worked.. except for babysitting, dog walking, and so on.

    So my question is how important is it to go to an accountant with experiences in doing dancers' taxes?

    How do you gurls do your taxes? You go to individual accountant? H & R block? How do I look up an dancers' specified accountant.

    I'm very confused. As I'm planning to start dancing full time for a year to help paying for family's mortage... or go into foreclosure...

    So I'm under alot of stress... =(

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    Default Re: Is it important to find an accountant that has expierence with doing dancers' tax

    It's definitely in your best interest to find an accountant familiar with the industry. They'll have a better idea of what can and cannot be claimed as expenses, for one thing. You could certainly go to H&R Block or any regular accountant as well, but if you can, definitely find a dancer accountant. The best way to do this is to ask around the girls at your club and see who they use.

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    Default Re: Is it important to find an accountant that has expierence with doing dancers' tax

    if you read through you'll get a feel for what's involved. As to choosing an accountant, this is a good idea for someone just getting started in the business, since the accountant can advise you how to structure things to your best advantage. This is particularly important in light of the tax changes that are highly likely to impact 'small business' owners ( which includes independent contractor dancers ). The accountant doesn't necessarily need to have specific experience with dancers / artists / entertainers. but definitely needs 'small business' experience.

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    Default Re: Is it important to find an accountant that has expierence with doing dancers' tax

    Thank you for the advice on the accountant part. I have one more question. What occupation title could I use when filing taxes? exotic dancer? Do I have to tell the accountant directly? Would it leave a paper trail for my parents to know in the future? I certainly, if there is a way, I can't let my parents know.... or don't prefer my long future employer to know..........

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    Default Re: Is it important to find an accountant that has expierence with doing dancers' tax

    ^^^ well you can name the 'business' anything you want, but the IRS has official occupation codes for businesses like 'performing artist' that have to be listed. And yes you should tell the accountant every detail, since it will affect which approaches may save you the most in taxes.

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    Default Re: Is it important to find an accountant that has expierence with doing dancers' tax

    What area are you in? Maybe someone here can recommend someone they use.
    I propose a toast - to my self control.... I see you crawling, helpless, on the floor.......
    -Mark Sandman

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    Default Re: Is it important to find an accountant that has expierence with doing dancers' tax

    im in the chicago area. thats a good idea. as im clueless right now of who to use. about how much they charge per quarter you use them? or they charge by the year?

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    Default Re: Is it important to find an accountant that has expierence with doing dancers' tax

    I'm kinda curious about how much an accountant 'should' charge too. What the going rate? Do you pay by hour, is there a retainer involved? I got a phone number from a girl at work, but I'm hesitant to call if I dont have a ballpark idea of what I ought to be paying.



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    Default Re: Is it important to find an accountant that has expierence with doing dancers' tax

    with a 'first time' client, accountants usually charge by the hour. But once a relationship is established, i.e. the accountant already understands the client's business structure and the approximate amount of work involved, a single price quote may emerge.

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    Default Re: Is it important to find an accountant that has expierence with doing dancers' tax

    I'm in Baltimore. I file yearly and pay him from $100-$150. I've been going to him for 5 years now and he's totally worth it.
    I propose a toast - to my self control.... I see you crawling, helpless, on the floor.......
    -Mark Sandman

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    Default Re: Is it important to find an accountant that has expierence with doing dancers' tax

    do you report your income monthly, quarterly or annual? I just started dancing to and this is a new year and i wanna start reporting my money because i have credit card debt and i wanna start making more payments on the mortgage but i only work part time so i would be putting more money on my bills then what i make..whats a good way to start?

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    Default Re: Is it important to find an accountant that has expierence with doing dancers' tax

    again a good starting point would be the sticky thread 'My O My So Many IRS Forms"

    In general, independent contractor dancers are required to file estimated tax vouchers ( and send in accompanying checks to the IRS and their state income tax dept for the estimated taxes due ) on a quarterly basis. The next estimated tax filing deadline is this coming Monday 1 / 17 ( the usual 15th deadline was bumped because the 15th falls on a weekend ), and covers income earned from October 1st through December 31st of 2010. The next estimated tax deadline will be April 15th, and covers income earned from January 1st through March 31st of 2011.

    In the way of an explanation, these 4 quarterly estimated tax payments are the rough equivalent of the 12 or 26 or 52 estimated tax payments made on behalf of employees by their employers ( via withholding money from their monthly, bi-weekly or weekly paychecks ). The good news is that you only have to deal with them 4 times a year. The bad news is that there isn't any 'employer' to do the paperwork for you !

    April 15th is also the due date for filing the annual tax return for full year 2010 earnings. Filing the annual tax return essentially calculates the actual taxes due on those 2010 earnings, 'squares up' with the amount of estimated tax payments previously made in April, June, September of 2010 and January of 2011, and either refunds you the overpayment or requires an additional check to cover the underpayment. If the underpayment amounts to more than 10% of the actual taxes due, the IRS may also add interest charges and/or penalty charges.

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    Default Re: Is it important to find an accountant that has expierence with doing dancers' tax

    how much do you think you would have to pay if you reported about $800 a week? is there a way i could figure that out on my own?
    thanks

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    Default Re: Is it important to find an accountant that has expierence with doing dancers' tax

    ^^^ you can come pretty close. On an annualized basis, $800 a week = $40k per year.

    SSI / medicare tax is going to take a 15.3% 'bite' no matter how much you earn ... so on an annualized basis this is would be $ 6120 or roughly $1530 per quarter

    Federal income tax is subject to a lot of variables ( i.e. if you have children, if you qualify for certain credits, if you have legitimate business expense tax deductions, etc.). For a 'single' dancer with no children, no 'oddball' tax credits, and minimal business expenses, pulling a number out of the hat would put the federal income tax in the ballpark of $ 5400 on an annualized basis or roughly $ 1350 per quarter

    Thus at an income level of $800 per week, the quarterly estimated federal income tax payment is going to be in the ballpark of $1530 + $1350 = $ 2880. Note that this amount will go up and down based on the dancer's actual income earned in a particular quarter - which is affected by the fact that not every IRS quarter has the same number of weeks in it ( 2nd quarter has only ~9 weeks, and 4th quarter has ~16 weeks )

    If you live and/or work in a state ( and sometimes city ) that also levees its own income tax, an additional quarterly estimated tax filing and an additional annual state tax return will also be required. However, these state and local income tax rates very tremendously - so some specific info would be required. The highest state and local income tax rate probably applies to New York City, where the estimated quarterly tax payment due on $40k of annualized income would probably be on the order of $ 500.

    Again let me throw out a disclaimer that individual tax liabilities are subject to a pile of different variables. The numbers I have 'thrown out' are probably conservatively high.

    If you have a basic understanding of how taxes work, or if you are willing to make the effort to learn, there is computer tax software out there that can easily handle the preparation of estimated tax vouchers and annual tax returns for non-incorporated dancers. Personally I have been using TurboTax for many years now. For 2010 dancers need, at minimum, Turbo Tax Premier in order to get the Schedule C 'profit or loss from a business' tax calculation capability.

    Of course, that software costs around $100 ... and also requires that you have some basic idea of what you are doing re business accounting. In general, for 'newbie' dancers who don't have any 'business structure' established, it's often a good idea to pay the extra $100 or whatever to have an accountant set things up in the most opportune manner for her. After all, the cost of the accountant ( or for that matter the tax software ) are legitimate business expense tax deductions - meaning that even at a $40k per year income level the gov't will wind up 'paying' for 1/3rd of the cost ( via reduced tax liability ) !


    I would also add that, with the recent extension of the GWB tax cuts, 2011 dancer income will now only be subject to a 13.3% Social Security / medicare tax. But that doesn't apply to 4th quarter 2010 income upon which estimated tax payments are due by next monday !

    ~
    Last edited by Melonie; 01-14-2011 at 02:18 AM.

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    Default Re: Is it important to find an accountant that has expierence with doing dancers' tax

    Quote Originally Posted by kermit210 View Post
    I'm in Baltimore. I file yearly and pay him from $100-$150. I've been going to him for 5 years now and he's totally worth it.
    Can you tell me his name? I'm looking for an accountant in Bmore.

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