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Thread: how many of you actually PAY taxes and how do i get started with that?

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    Member Jayhde's Avatar
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    Search how many of you actually PAY taxes and how do i get started with that?

    Hey all. i'm new to the whole dance world. no one i know around here pays taxes at any of the clubs ive worked at (or my other dancer-friends)....and they have been dancing for years. how does "the man" catch you? but thats not what im even worried about (just wondering) b/c i wanna start going legit ASAP. do i need to hire an accountant? b/c i have NO IDEA what to do...

    do you ladies actually get anything BACK at the end of the year (i.e. like if you save receipts for outfits, shoes, makeup and whatnot) and then get your tax check like at other jobs?

    someone mentioned the housewife thing...now i know housewifes do NOT usually buy knee high leather boots/7-in clear platforms or sexy taxi cab out fits right? i need to know b/c right know i am workin of clothes i make, shoes that hurt and i want to spend money on good things, but how do i PROVE they are all for dancing?? also, do you keep track of all your tipping out (bar, dj, etc...) and house fees? do you get THOSE back also?

    do you think an accountant will give me a free consultation, also, how do i go about FINDING a good one?

    how many of you actually HAVE an accountant and about how much do you pay him and what exactly does he do for you?

    and then ladies, how many of you just do it on your own....props to ya btw!

    a lot of questions i know, but i have nowhere else to go! help me fellow dancers!

    any answers would be help. thanks gals!



    oh, and i live in tampa if that makes a difference....i know different states/different laws.
    fuck it.


    ~Jayhde~

  2. #2
    Member Jayhde's Avatar
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    Default Re: how many of you actually PAY taxes and how do i get started with that?

    wow i wish ya'll would reply to this....:-(
    fuck it.


    ~Jayhde~

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    God/dess montythegeek's Avatar
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    Default Re: how many of you actually PAY taxes and how do i get started with that?

    Jayhde,
    First, they do not necessarily catch you. the comparison I use is like speeding--they do not catch everyone driving 95 in a 55 mph zone, but when they do it costs you a hell of a lot. Then you have the fact that the ways they CAN catch you are rising all the time. All it takes is a computer saying J spent 60K a year and paid no taxes and whammo you end up on the IRS fecal roster and they start digging. If you do this for several years you could end up getting a MONSTER back tax bill.

    The way to start is either spend money and hire an accountant-- or dig in and learn a lot of IRS shit. The choice is yours depending on your disposition.
    First stop is www.irs.gov The form you need is 1040ES for paying estimated taxes during the course of the year. Click on forms and publications then in the new window select under download forms by form and instruction number. About a third of the way down the long list you will find 1040ES for 2005.

    If you are like most people the best way the first year is to go to an accountant--VERY EARLY. Like NOW. As 4/15 approaches those guys are going to be working long hours and their busy schedule is not just controlled by dates that are the same as your estimating. Corporations file on a different date schedule as individuals to smooth out the load. Call and make an appointment ASAP.

    As a minimum you want an accountant who has experience with independent contractors, preferable entertainers, preferably dancers. A good CPA who does not do dancers taxes can do yours but how are you going to know going in how good they are?

    There is a lot of stuff involved that you are not going to know going in. You will either have to learn it (like Melonie did) or pay someone to teach you.

    Do not expect to find too many "free consultations" or to get much for free. These are accountants, not whiplash lawyers where 1 in 50 of the freebies generates a big commission law suit. These are professionals who make their living "knowing shit others do not and putting up with the picky details"--more like financial doctors.

    You can learn the stuff and details, but there is a lot of it. If your gross income is enough--go with a pro, but pay attention and learn, because the more you know the more you can give them the info they need.

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    God/dess Emily's Avatar
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    Default Re: how many of you actually PAY taxes and how do i get started with that?

    Probably the reason there are so few responses is because this question has been asked so many times in this forum. Do a search! You'll probably find answers to all your questions, including those you didn't know you had!

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    Member Jayhde's Avatar
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    Default Re: how many of you actually PAY taxes and how do i get started with that?

    ohmigod thank you so much guys.....yeah, emily i am starting my search right now actually!! hehe...yeah, i dont wanna be screwin with "the man" b/c i know in the long run he will bite me in the ass! as someone said earlier, dancers on THIS site are very money savvy and smart, unlike most of the people i work with who dont pay taxes or anything.....i'm the one going HUH??? when people start talking about these things. but thank you, i'm going to start looking for an accountant right away!
    fuck it.


    ~Jayhde~

  6. #6
    Banned Melonie's Avatar
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    Default Re: how many of you actually PAY taxes and how do i get started with that?

    someone mentioned the housewife thing...now i know housewifes do NOT usually buy knee high leather boots/7-in clear platforms or sexy taxi cab out fits right? i need to know b/c right know i am workin of clothes i make, shoes that hurt and i want to spend money on good things, but how do i PROVE they are all for dancing?? also, do you keep track of all your tipping out (bar, dj, etc...) and house fees? do you get THOSE back also?
    If the clothes or shoes that you are deducting as a business expense are not something that a housewife would also buy, then it's extremely unlikely that your deduction would be questioned. The only proof that you'd ever need to make is that IF you were audited for some reason you'd have to model the outfit and shoes for the IRS agent (which might earn you lots more brownie points than just having this particular deduction allowed !).

    Any money which you must pay to the club or to employees of the club in order to work there is tax deductible as a business expense. Any money which the club (illegally) requires you to pay to persons who are NOT employees of the club i.e. independent contractor DJ's, bouncers, house moms etc. enters into a gray area - technically unless you issue these people 1099-misc forms at the end of the year for the money you paid out to them, from a legal standpoint these tipouts are non-deductible charitable gifts on your part !

    In my own case, I use TurboTax to 'rough in' my own tax return. I then have my accountant review and 'tweak' the tax return in areas where he thinks I've been either excessively risky or overly conservative, and file the return showing my accountant as a paid preparer ( which reduces the chances of audit I'm told ).

    Monty is absolutely correct that when independent contractor business persons file tax returns, the risk of being audited increases exponentially with the dollar amounts and types of deductions taken. For example, if very few deductions are taken the chance of being audited is about the same as the random number of people the IRS audits every year, or about 15 out of every 1000 people. However, as the total deductions begin to rise in dollar value compared to the amount of declared income, that 1.5% number starts to rise towards 5%. And when certain types of questionable large deductions clearly wave 'red flags' to the IRS computer, the audit probability number can rise to 50%+.

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    Banned Melonie's Avatar
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    Default Re: how many of you actually PAY taxes and how do i get started with that?

    unlike most of the people i work with who dont pay taxes or anything.....i'm the one going HUH???
    Well, the IRS has announced that this year they are partly changing their focus away from scrutinizing deductions but increasing their focus on the declared incomes of people working in cash/tip businesses. A targeted effort is already underway towards people working in casinos, and towards people working as cabdrivers. Exotic dancing is of course a well known cash business !

    Another change this year is that clubs with 'corporate' clubowners like all other corporate execs are now under increased pressure to clean up their accounting procedures (lest the CEO and CFO wind up getting the Ken Lay treatment and spending a few years in the federal pen for fraud). This of course creates a dilemma for clubs who don't report payouts to dancers. If the club properly claims 100% of the money they take in through the cash register for private dances, champagne room etc. then the club must pay taxes on all that money. On the other hand, if the club doesn't claim that money as income then they are risking a Ken Lay style audit of their own. So to explain away the money trail, corporate clubs are beginning to issue 1099-misc forms to the IRS for money they paid out to dancers for their share of private dances, their share of champagne room etc. The 1099-misc form tells the IRS that part of the money shown on the club's cash register was immediately paid out again to dancers, thus it is considered income attributed to the dancer(s) not the club.
    It just so happens that last week was the deadline for clubs to mail out 1099 forms, and that many dancers will start receiving them in their mailbox next week.

    Now when a dancer who hasn't been declaring income and hasn't been paying estimated taxes receives a 1099 form saying she received for example $30,000 in payouts from the club during 2004, she'd better get ready for a triple screwing. First she's going to be forced to file a tax return reporting the 1099 amount as income, with some additional tip income thrown on top, and she's going to have to pay taxes on that income. Second, since she didn't make estimated tax payments in april, june, september 2004 or january 2005 she's going to get hit with an underwithholding penalty on top of the taxes she owes. Third, if the amount of income on the 1099 form is substantial, say $30-$40-$50,000, then the IRS will probably have reason to start doing more research into the dancer's personal finances i.e. the amount of money flowing into and out of her bank accounts for the past 3 years, the amount of money being paid out for car payments/credit cards etc. If the numbers over the past 3 years show lots of money coming in and lots of money being spent, it's EXTREMELY likely that the IRS will decide to audit the dancer, in the process reconstructing the amount of income she earned but didn't report in the two previous years, and ending up with the dancer owing a massive bill for back taxes plus penalties plus interest.

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    Member Jayhde's Avatar
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    Default Re: how many of you actually PAY taxes and how do i get started with that?

    ooooh thank u melonie i know you've prob. wrote that soooo many times but i appreciate it....thanx so much!
    fuck it.


    ~Jayhde~

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    Default Re: how many of you actually PAY taxes and how do i get started with that?

    in addition to the things Melonie listed lets not forget maybe a trip to prison!.

    Let's remember "tax evasion" and that is what you are doing when you don't declare your income and pay taxes on it, is what they sent Al Capone to prison for.

    Don't say it can't happen, a few years ago no one would have believed that dancers would be getting 1099's like they are now.

    Yes it would probably be just a "making an example" thing but do you want to risk being the example?

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    Banned Melonie's Avatar
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    Default Re: how many of you actually PAY taxes and how do i get started with that?

    Yes it would probably be just a "making an example" thing but do you want to risk being the example?
    Yes that is always a possibility, especially if the dancer in question is audited, if the IRS decides that she underreported $50,000 a year in income for the past three years, that she owes them an additional $45,000 in back taxes plus another $25,000 in penalties and interest, and she can't come up with the $70 grand the IRS wants paid immediately !

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    God/dess Emily's Avatar
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    Default Re: how many of you actually PAY taxes and how do i get started with that?

    okay, Al Capone went to prison for tax evasion because that's all they could get him for, but if hos only crime was tax evasion, he probably wouldn't have been sent to prison.

    Let's look at the big picture here! Al Capone was not just trying to cheat the IRS!

    I think the same happened to Heidi Fleiss too (among other charges)

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    Default Re: how many of you actually PAY taxes and how do i get started with that?

    Yes I admit it is unlikely, but it is a possibilty, and as I said if it did happen it would probably be one of those "we are making an example" things, but I ask again do you want to risk being that example?

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    Member Jayhde's Avatar
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    Default Re: how many of you actually PAY taxes and how do i get started with that?

    hells no i dont!
    fuck it.


    ~Jayhde~

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    Featured Member exotica17's Avatar
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    Default Re: how many of you actually PAY taxes and how do i get started with that?

    There are so many dancers that are getting away with not paying taxes, and you could probably get away with it, too. But I know what you mean, you actually want to be an honest person and do your part--good for you! Let me tell you, though, it really bites you in the ass, paying your taxes and such and then constantly hearing other dancers brag about how much they make and how much their getting back in taxes (or not paying taxes at all and claiming all the money they make as gifts!) "Yeah, I made over $100,000 this year tax-free!" I am still pissed--I did my taxes about a week ago. My husband and I work our asses off and we have a kid and I go to school, and we still have to pay taxes out of our asses.

    Anyway, do the quarterly estimated taxes--save 30% of your earnings each night that you work.

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    Banned Melonie's Avatar
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    Default Re: how many of you actually PAY taxes and how do i get started with that?

    All I can add is that with every passing year there is increasing 'oversight' into all financial transactions ... from clubs issuing W2's and 1099's, to state auto and real estate titles/deeds being reported, to automatic reporting of large dollar amount transactions, to automatic reportihg of money order purchases, to instant access to bank account and credit card transactions, to investment/retirement account transactions ... the list goes on and on. If someone elects not to report their 'cash' income these days, they had better be prepared to keep that cash in their mattress and only spend it in small amounts at any one time, lest the 'oversight' into their bank balances and expenditures give away the existance of that unreported income. They should also be prepared to accept the fact that loan companies and other financial institutions do not and will not recognize the existance of income sources which are not documented on tax returns, with associated effects on the person's credit rating and creditworthiness in the future.

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    Featured Member exotica17's Avatar
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    Default Re: how many of you actually PAY taxes and how do i get started with that?

    Yep. Melonie is right--I can vouch for the creditworthiness thing! Loan companies look at how much you reported in earnings on your tax return.

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