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Thread: GOOD news about taxes!

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    Default GOOD news about taxes!

    First, i would like to say a BIG thank you to all the ladies i messaged about my taxes. You were all a great help!
    Second, a taxpro at H&R block called and told me I did not have to file my taxes because i don't make enough. I only made $3600 in 8 months, which was a part-time caming job.
    Third, i hope everyone file their taxes before April 15th!
    Anyways, thanks for all the help! I appreciate it!
    Last edited by sweet_baby; 04-09-2011 at 12:16 PM.

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    Default Re: GOOD news about taxes!

    you might want to pay particular attention to the third point from the IRS website listed below ...


    (snip)To determine if you need to file a Federal Income Tax return for 2010 answer the following questions:

    Occasionally, individuals have one-time or infrequent financial transactions that may require them to file a Federal Income Tax return. Do any of the following examples apply to you?

    Did you have Federal taxes withheld from your pension and wages for this tax year and wish to get a refund back?

    Are you entitled to the Earned Income Tax Credit or did you receive Advance Earned Income Credit for this tax year?

    Were you self-employed with earnings of more than $400.00?

    Did you sell your home?

    Will you owe any special tax on a qualified retirement plan (including an individual retirement account (IRA) or medical savings account (MSA)? You may owe tax if you:
    - Received an early distribution from a qualified plan
    - Made excess contributions to your IRA or MSA

    Were born before July 1, 1939, and you did not take the minimum required distribution from your qualified retirement plan.

    Received a distribution in the excess of $160,000 from a qualified retirement plan.

    Will you owe social security and Medicare tax on tips you did not report to your employer?

    Will you owe uncollected social security and Medicare or Railroad retirement (RRTA) tax on tips you reported to your employer?
    Will you be subject to Alternative Minimum Tax (AMT)? (The tax law gives special treatment to some kinds of income and allows special deductions and credit for some kinds of expenses.)

    Will you owe recapture tax?

    Are you a church employee with income in wages of $108.28 or more from a church or qualified church-controlled organization that is exempt from employer social security or Medicare taxes? (snip)


    in other words, the H&R block 'tax pro' just told you something that is in direct contradiction to IRS rules which apply to Americans who are not 'employees'.

    Did you receive a W2 from the webcam host ... I know that the answer is NO, meaning that you are not anyone's employee thus 'self-employed'. You may have received a 1099-misc form from your webcam host reporting the payment of $3500 in independent contractor BUSINESS income payments to you last year.

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    Default Re: GOOD news about taxes!

    nope, didnt receive anythin from LJ. i told them i was an entertainer. and that i am only required to pay taxes if i make over $8000 in a year. cuz if i do file taxes which i dont make enough now... i would owe state and federal tax and the fees i would pay them to file my taxes. they told me its not worth filing.. but i CAN if i wanted to...and i am a 20 years old college student @ community college and livin wit parents. FAFSA covers my whole tuition.
    Last edited by sweet_baby; 04-09-2011 at 04:19 PM.

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    Default Re: GOOD news about taxes!

    You're only required to pay taxes if you make over 8,000 in a year ONLY if you are paying taxes on that 8,000. If you aren't paying taxes on the money you are making, ex: webcamming, stripping, basically almost anything in the sex industry you are required to pay taxes on that if it is over, I thought 600 but melonie said, 400 which sucks lol. My bf works in construction and I sell his scrap metal from jobs he does and I have to pay taxes on it because it is over a certain amount every year and junkyards don't take out taxes. It's basically the same idea. I would call back h &r block and let them know that no taxes were paid on that money and see what they say.

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    Default Re: GOOD news about taxes!

    ^^^ that is a reference to employer payroll tax withholding, where the employer is sending in estimated tax payments on behalf of the employee on a weekly / monthly basis. In the case of a self-employed person, estimated tax payments are the self-employed person's own responsibility ( fortunately the filings and payments are only due 4 times a year instead of every week / month ).


    I don't want to cause any anxiety over this, but consider the following ...

    - even though a 1099 form from the webcam host ( apparently ) didn't show up in the OP's mailbox, I have never heard of a webcam host who did NOT send out 1099's to the IRS. The webcam host's motivation of course is that if it fails to send out a 1099 for money paid to webcam girls, the webcam host will have to report that money as their own income and pay additional taxes on it themselves.

    - if the OP chooses not to file a tax return showing the $3,600 in webcam earnings, and if the IRS did receive a 1099 from the webcam host listing the name and social security number of the OP, the first thing that will happen is that IRS computers will start searching to try and match up that SS# with a tax return to see if the $3,600 has been listed as income. The IRS computers WILL still find the OP's social security number ... on her PARENT's tax return. The IRS computers will NOT find a line item income entry showing the $3,600 in 'child's' earnings listed on the parents' tax return, and may institute an audit of the parents.

    - Additionally, since the OP is a full time college student - and is collecting FAFSA student grant money - the IRS computers will also connect with FAFSA computers to check on how much total household income ( i.e. parents income plus child's income ) was reported on the FAFSA grant application form. If the $3,600 in webcam income was not included in the total household income figure upon which 2011 FAFSA approval was based, FAFSA may also investigate. Indeed, if another $3,600 in total household income would have made a difference in student grant eligibility, FAFSA may seek repayment of any grant moneys already paid out to which the OP would not have been eligible for had the $3,600 in additional household income been reported on the 2011 FAFSA grant application as required by law. FAFSA can in fact use the IRS to recover said money from the parent's tax refund, since it was the parents who signed the FAFSA grant application.

    It is somewhat true that a person who only earned $3,600 in 2010 would probably wind up not having to pay any net taxes. This would depend on whether or not that person could claim themselves as a dependent on their own tax return ( versus being claimed as a dependent by parents ) and some other variables. From a legal standpoint, the 'self-employment' tax starts being charged on the first dollar earned, so the resulting net taxes would depend on what other allowances or credits could be applied. But the larger point is that, even if no net taxes must be paid, the law still requires that the 'self-employed' person report to the IRS income earned if it is more than $400.

    FAFSA also requires that said income also be reported as part of 'total household income' included on the FAFSA grant application. Where the student receiving FAFSA grant money is in fact a dancer who a) has not told her parents about dancing / webcam income she is earning, and b) has allowed her parents to file a FAFSA grant application form that is technically 'fraudulent' ( because it does not include the extra total household income contribution of the student's dancing / webcam income ), things have the potential to turn 'messy'.

    Granted that in a scenario involving dancing in a club that never issues 1099's, if the dancer chooses not to report her income it is rather unlikely that the IRS would ever discover that income exists ( in the absence of some extraordinary event like the club itself being audited by the IRS, or some stupid act on the part of the dancer like buying a new car with no reported income to explain how she's able to make the car payments ). But if a club or a webcam host generates a 1099 form which is sent to the IRS ( to reduce the club's / webcam host's own tax bill ), they are TELLING the IRS that the income exists !!!

    ~
    Last edited by Melonie; 04-10-2011 at 04:45 PM.

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    Default Re: GOOD news about taxes!

    well only my mom works. my dad doesnt work. my parents doesnt file taxes cuz my mom doesnt make enough. she makes less than $2,000 a month. i already sent my application to FAFSA in JAN 2011. my tuition is only $5,000. pell grant covers $2,500 and FAFSA covers $2,500. and i already told h&r block that this is my first time filing..

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    Default Re: GOOD news about taxes!

    how will it be possible for me to report it to the IRS? do i need to fill out a form? or go see an accountant? this is my 1st time...im thinkin of calling IRS tmrw and making sure. and i worked on LJ since last AUG- and stopped working. only made $3700 in those months altogether

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    Default Re: GOOD news about taxes!

    A. file a form 1040 tax return with the $3.600 in income listed as business income on Schedule C.

    B. have your parents report the $3,600 as 'child's income' on THEIR tax return ( or have them file an amended tax return if they have already filed their own return )

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    Default Re: GOOD news about taxes!

    my parents filed ZERO tax..it says $0 on the tax paper.

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    Default Re: GOOD news about taxes!

    ^^^ probably what your parent's tax return actually says is that they owed zero INCOME tax. That is not the same thing as not having to pay ANY tax ... since in all probability social security and medicare taxes were withheld from your mother's weekly employee paychecks !!! This may also not remain the case if $3,600 in 'child's income' was added to your parent's tax return.

    Again, if you're absolutely certain that the web host did not send a 1099 form to the IRS, even though the IRS code says that you are required to file a tax return on $3,600 of 'self-employed' income, the 'real world' situation is that the IRS would most likely never notice or care. But if your webcam host DID send a 1099 form to the IRS, even if you didn't receive a copy, receipt of that form by the IRS is going to set automatic events in motion. I really don't know what else I can say.

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    Default Re: GOOD news about taxes!

    i kept asking LiveJasmin about it, they kept telling me that they do not handle my tax issues. and will not send me any forms.

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