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Thread: IRS Changes that may effect cam models

  1. #1
    Featured Member Rina's Avatar
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    Default IRS Changes that may effect cam models

    Thought the ladies here might want a heads up.
    "Appearance and Image


    Taxpayers in the entertainment industry sometimes may incur expenses to maintain an image. These expenses are frequently related to the individual's appearance in the form of clothing, make-up, and physical fitness. Other expenses in this area include bodyguards and limousines. These are generally found to be personal expenses as the inherently personal nature of the expense and the personal benefit far outweigh any potential business benefit.

    No deduction is allowed for wardrobe, general make-up, or hair styles for auditions, job interviews, or "to maintain an image"."

    http://www.irs.gov/Businesses/Small-...nment-Tax-Tips
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    Default Re: IRS Changes that may effect cam models

    Fuck, I can't take my limousine to the Supermarket anymore now.


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    Default Re: IRS Changes that may effect cam models

    ^^^ this is another permutation of an earlier IRS 'official' opinion which is commonly referred to as the 'Housewife Test'. Under that IRS doctrine, makeup is deductible as a business expense if it was purchased from a theatrical supply house, but NOT deductible if purchased at a department store. The rationale is that 'housewives' buy department store makeup with absolutely no business reason for doing so, thus said makeup must be for 'personal benefit', thus not allowed as a business expense tax deduction.

    The same principle applies to lingerie, bikinis, plastic surgery procedures ( with the specific IRS exception for 'professional sized' breast implants ), shoes, etc. The same principle arguably applies to tanning salons, hair salons, health clubs / gym memberships, etc. 'Housewives' spend money on all of these items, so the IRS takes the position that they are for personal benefit and not deductible as a business expense.

    Ironically, the IRS has a conflicting doctrine that any expenses that are 'ordinary and necessary' for the operation of a business ARE legitimately deductible. Or put another way, where exotic dancing / camming are concerned, it is arguably 'ordinary and necessary' for girls to spend money on the above items. Because of this conflict between existing IRS doctrines, lots of dancers and camgirls have often attempted to claim 50% of money spent on the above items as a business expense.

    However, this latest IRS opinion regarding 'Appearance and Image' related expenses may put the 50% strategy at risk of an audit if used again on tax returns to be filed next spring, because it specifically disallows business expense tax deductions related to appearance.


    because this thread is applicable to exotic dancers as well as camgirls, and involves a financial issue i.e. business expense tax deductions, it might be better to move this thread to the Dollar Den.
    Last edited by Melonie; 10-15-2012 at 03:34 AM.

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    Default Re: IRS Changes that may effect cam models

    Well this sucks... it pertains to us escorts as well, btw.

    Makes me wish I hadn't complained to myself over the hassle of saving receipts for these types of expenses. So basically now, for what I do..the only things that count as expenses are flight/hotel costs and condoms? Not even lingerie and underwear that I get for work? Jeez.

    My deductions are going way down. I guess this is how taxes are going to go up for us...I have the feeling that was the plan because generally, there is a lot of money in the entertainment sector, not just the adult biz, but across the board.
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    Default Re: IRS Changes that may effect cam models

    Quote Originally Posted by BlkSharpie View Post
    So basically now, for what I do..the only things that count as expenses are flight/hotel costs and condoms? Not even lingerie and underwear that I get for work? Jeez.
    Dude I hope you're not reporting condoms to the IRS as expenses. Talk about red flags going up! HA!

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    Default Re: IRS Changes that may effect cam models

    No deduction is allowed for wardrobe, general make-up, or hair styles.

    I wish the govt would stay away from camming/adult industry. They're just trying to get money from where ever they can. If we don't/didn't have wardrobe, makeup, hair styles then we couldn't do our job or make any money. All the things listed are part of our job and what we have to spend money on. Smh it doesn't even make sense to say we can't claim them.

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    Default Re: IRS Changes that may effect cam models

    this pisses me off.
    i will still claim my make up and if IRS says it wasnt for business, i shall invite IRS to sit with me with no makeup on when I cam and see if i make any money...cause i wont be making any so then they wont be making any either..
    How retarded... do gov employees have any brains at all?
    like really WTF....
    I need makeup to cam, just as they need food daily so they dont starve to death.
    Is the stupidity growing lately? Its the season?
    someone at IRS did not get laid in a long time? lol

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    Default Re: IRS Changes that may effect cam models

    Quote Originally Posted by Lovelyme View Post
    Dude I hope you're not reporting condoms to the IRS as expenses. Talk about red flags going up! HA!
    They fall under the category of "supplies"

    About this whole thing though, like you said Fridays, it really makes no sense across the board, not just for us. So musicians and actors cannot list clothes and makeup as expenses either. Housewives use notepads, printers and ink, pens & pencils, general basic office supplies as well. Where does the line end?
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    Default Re: IRS Changes that may effect cam models

    Housewives also use sex toys! : o

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    Default Re: IRS Changes that may effect cam models

    When it says "No deduction is allowed for wardrobe, general make-up, or hair styles for auditions, job interviews, or "to maintain an image".""


    CG's arent doing auditions or job interviews so thats cut out straight away. When they say "to maintain an image", what does this mean? Does it mean on the red carpet etc or while shooting scenes for a movie?

    If it means red carpet and when your out and about etc then this law doesnt really change anything for CG's does it?

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    Default Re: IRS Changes that may effect cam models

    This is stupid, because any person could conceivably buy any damn item, does that mean we can't deduct it? Housewives buy computers, right? Yet, presumably they can be deducted? Gah, even our tax laws are misogynistic!! Hey IRS- quit sweatin' our nuts!
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    Default Re: IRS Changes that may effect cam models

    Quote Originally Posted by BlkSharpie View Post
    They fall under the category of "supplies"
    As escorts, we're not supposed to be having sex with clients according to the law so deducting condoms would be asking for trouble even though it falls under "supplies". Wouldn't that be pretty much telling the IRS that prostitution is taking place? Every veteran escort I've spoke to about this agrees it would only cause trouble. You need to tell me how you file your taxes and get away with deducting condoms as expense so I can get on board. I'm gonna ask on VH!

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    Default Re: IRS Changes that may effect cam models

    The thing that really baffles me is the fact they think that the 'average' housewife can afford all these things on a minimum wage income if it is being apply across the board equally.

    Am I missing something obvious?

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    Default Re: IRS Changes that may effect cam models

    Housewives buy computers, right? Yet, presumably they can be deducted?
    Actually, you can only take a 100% safe business expense deduction for a computer, for internet access etc. if there is a second computer and second method of internet access available for personal use !


    My deductions are going way down. I guess this is how taxes are going to go up for us...I have the feeling that was the plan because generally, there is a lot of money in the entertainment sector, not just the adult biz, but across the board.
    That's ONE plan. The OTHER plan is coming on January 1st if the US congress doesn't act in the meantime ... an additional 2% in 'self-employment' tax, plus higher % tax brackets for federal income tax.

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    Default Re: IRS Changes that may effect cam models

    Quote Originally Posted by Lovelyme View Post
    As escorts, we're not supposed to be having sex with clients according to the law so deducting condoms would be asking for trouble even though it falls under "supplies". Wouldn't that be pretty much telling the IRS that prostitution is taking place? Every veteran escort I've spoke to about this agrees it would only cause trouble. You need to tell me how you file your taxes and get away with deducting condoms as expense so I can get on board. I'm gonna ask on VH!
    Well, I may be far reaching, but I just save all my receipts, and include it under supplies. An itemized list of every thing I buy and use is not sent to the IRS with my taxes, the only way it would be come to light is if I were audited, in which case I keep good records. Of course, knowing I cant deduct "image realted" items now, Ill have to go back through this whole past freaking year and adjust my records, Im not going to include stuff specificially stated as non-deductable. But condoms are still supplies.

    The IRS doesnt care what you do, they care about getting their cut out of what you earned. The only laws the IRS is concerned with are the ones to do with making sure they get your money. I dont specifically list "condoms used for fucking my clients" If asked about that expense, I could say they were used in my consulting business for sexual education / preventable disease courses to demonstrate how to keep ones self safe. Dont believe me...catch me in the act and prove it Thats my stance anyway.

    Quote Originally Posted by Melonie View Post
    Actually, you can only take a 100% safe business expense deduction for a computer, for internet access etc. if there is a second computer and second method of internet access available for personal use !
    Yeah, when Tax Domme did my taxes for me, she let me know that things such claiming office equipment (to include computers/printers), and office space within the home were the major reasons self-employed got flagged for audit, because the rules on what you can claim and how you can claim it are so specific and strict, that most people claim it wrongly. She let me know, even though I was using my computer for cam, I would have to use it for *nothing else* but cam. And the area of my home where I worked out of, was not to be used for any other purpose either...stuff like that. And even if you had a dedicated room in your house that you worked out of, there were still so many stipulations...its just such a twisted and confusing code, that unless you rent a space to work out of completely seperate from your home, youre probably claiming it wrong.... They make it so freaking hard.


    That's ONE plan. The OTHER plan is coming on January 1st if the US congress doesn't act in the meantime ... an additional 2% in 'self-employment' tax, plus higher % tax brackets for federal income tax.
    Bartending is looking sweeter and sweeter every moment. Jeez...
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    Default Re: IRS Changes that may effect cam models

    Indeed, taking the 'home office' tax deduction was one of the major 'audit triggers' for the IRS this year. We don't yet know what the IRS will put on next spring's list of 'audit triggers', but it's now more than likely that business expense deductions for the now clearly defined 'personal' items could be added.

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    Default Re: IRS Changes that may effect cam models

    wait, now that the presidential debate was just on...
    Melonie, can u just tells us 1 thing that politicians can deduct, a major one, just cause they are politicians?
    Im working on my speech for when I go to court because I deducted my make-up LOL

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    Default Re: IRS Changes that may effect cam models

    ^^^ it's not exactly a deduction, but politicians can buy stock shares of a particular company today KNOWING that tomorrow's congressional vote is going to provide a huge subsidy / tax write off / gov't contract to that company !!! For non-politicians this is illegal 'insider trading'.

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    Default Re: IRS Changes that may effect cam models

    This drives me NUTS. I understand that it is designed to stop people just claiming EVERYTHING...(and to make them more money)..but really? I have costumes that are used solely for camming. And sex toys, and lube, and basically an entirely separate room with entirely separate EVERYTHING - except makeup and hair dye - because, well, I can't actually separate them entirely.

    But "housewives" buy EVERYTHING - they also buy printer ink, paper, staples, envelopes...but your average self-employed worker can claim those as business expenses. Grr.
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    Default Re: IRS Changes that may effect cam models

    Quote Originally Posted by ManyRoses View Post
    This drives me NUTS. I understand that it is designed to stop people just claiming EVERYTHING...(and to make them more money)..but really? I have costumes that are used solely for camming. And sex toys, and lube, and basically an entirely separate room with entirely separate EVERYTHING - except makeup and hair dye - because, well, I can't actually separate them entirely.

    But "housewives" buy EVERYTHING - they also buy printer ink, paper, staples, envelopes...but your average self-employed worker can claim those as business expenses. Grr.
    I know what you mean, I'd love to see them tell men that they are unable to buy those things because 'househusbands' buy them as well.

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    Default Re: IRS Changes that may effect cam models

    I have costumes that are used solely for camming. And sex toys, and lube, and basically an entirely separate room with entirely separate EVERYTHING - except makeup and hair dye - because, well, I can't actually separate them entirely.
    Technically speaking, nothing is stopping you from taking business expense tax deductions, the home office tax deduction etc. when you file your upcoming tax return. The risk, of course, is that doing so will greatly increase your chances of an audit. While being audited is a major pain, it isn't the end of the world as long as your business records, past tax filings etc. are all in good order. And there is at least some chance that the auditor will 'allow' some or all of your deductions, thus reducing your tax bill.

    But if your business records, past tax filings etc. are - shall we say - 'sketchy' - then being audited can open a Pandora's Box of bad possibilities. The worst case scenario would probably involve the IRS auditor reaching an opinion that the amount of money required to maintain your 'lifestyle' exceeds the amount of money that you have reported as actually having earned ... which in turn can lead to the IRS estimating that you earned significantly more money than you actually did, with a subsequent additional IRS bill for taxes owed on the level of income the IRS estimates.

    With some webcam hosts not issuing 1099 income reports, there is no way that you can conclusively prove that you DIDN'T earn the amount of additional money that the IRS estimates that you must have in order to finance your 'lifestyle' ... thus no way you can avoid having to pay the higher tax bill. Additionally, once the IRS forms an opinion that you have played 'fast and loose' with your business records and tax filings, it's a near certainty that they'll continue to scrutinize your future year tax returns, reported income, deductions etc. like a proverbial hawk for years to come.

    Bottom line is that claiming 'questionable' tax deductions involves a calculated risk. If your business records, personal finances, past tax filings, estimated tax payment history, credit rating, etc. are all in good order, then the potential tax savings value of those 'questionable' tax deductions may far exceed the negative fallout if and when you are audited. However, if your business records, personal financial history, past tax filings etc. are 'sketchy', then the potential negative fallout from an audit could cost you much more than the tax savings value of those 'questionable' tax deductions you attempted to claim. This is obviously a risk factor which varies widely from one individual to another.
    Last edited by Melonie; 10-17-2012 at 11:12 PM.

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    Default Re: IRS Changes that may effect cam models

    Yeah I have heard that...once you've been audited once, then you can pretty much bet on it that you'll get audited again.
    From what I understand, the whole process is a real pain.
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    Default Re: IRS Changes that may effect cam models

    ^^^ being audited is definitely no picnic !!! However, if your business records, personal finances, past tax return filings etc. are 'professional' and complete in terms of detail, it's really not that bad. The BIG audit problems start when the person being audited hasn't kept 'professional' business records, has intermingled personal finances with 'business' finances, has been ... shall we say ... 'fast and loose' with past tax return and estimated tax filings, etc. such that the IRS auditor adopts an attitude that the person being audited can't be 'trusted'.

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    Default Re: IRS Changes that may effect cam models

    Oh - for the record, and just back to the condom thing - I claim condoms. That said, I am not an escort, I just use them on sex toys for camming. But if you are doing both, there would be no way to prove that you are NOT using the condoms for camming.
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