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Thread: just started dancing...should I pay taxes?

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    Default just started dancing...should I pay taxes?

    I have read several posts about paying taxes and ect...I am very confused. Here is my question: My hubby works and supports me and our 2 kids. I just last week started working at a club in AZ. I didn't have to fill out any tax paperwork(yet anyways...I don't think it's required) If I only plan on doing this for a year or 2...do I need to save and pay taxes? How would the IRS know if I was working as a stripper or not? My husband has been our sole provider for the last 3 years. I'm very confused about the whole thing. I know I can always talk to an accountant, but if I don't have to I'd rather not. Thanks.

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    God/dess Emily's Avatar
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    Default Re: just started dancing...should I pay taxes?

    Will the IRS find out? Probably not.

    Can they? yes.

    you don't have to pay taxes and you can risk it, but that's illegal and can hurt you. You are asking a question similar to, "is it okay to speed if you don't see any cops around?"

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    Banned Melonie's Avatar
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    Default Re: just started dancing...should I pay taxes?

    I highly recommend reading the 'how many of you actually pay taxes' thread.

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    Featured Member exotica17's Avatar
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    Default Re: just started dancing...should I pay taxes?

    Yes! My husband supports me and our kid, too, and I still pay taxes. They more than likely will not find out, but they can. But why risk it? It's illegal, and you will really end up paying out of your ass if you have to end up paying penalties and backtaxes should you get audited. The way a stripper pays taxes is by paying quarterly estimated taxes. Since you didn't work as a stripper last year, it is not required by the IRS that you pay quarterly taxes--you can just save up and pay one lump sum at tax time. Save 30% of each of your night's earnings for taxes. It does not matter that you didn't have to fill out tax paperwork; the IRS can still find out.
    Last edited by exotica17; 02-16-2005 at 11:34 PM.

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    Default Re: just started dancing...should I pay taxes?

    I agree..I didnt get tax paperwork or a 1099 form or anything from the club I worked at, but I know of a couple of girls who did. Why I didnt get one, I dunno. Im not fretting it though.

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    God/dess kitana's Avatar
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    Default Re: just started dancing...should I pay taxes?

    Quote Originally Posted by Emily
    Will the IRS find out? Probably not.

    Can they? yes.

    you don't have to pay taxes and you can risk it, but that's illegal and can hurt you. You are asking a question similar to, "is it okay to speed if you don't see any cops around?"
    If I remember correctly, paying taxes isn't techinacally illegal. I read about it a few years back and there a large group of people who pay their state taxes but never theri federal ones.

    It's something about how the IRS isn't technically part of the US government so you can't be forced to pay them. I'm sure Mel can enlighten us more about this.


    Kitana
    Last edited by kitana; 03-16-2005 at 08:13 AM.
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    Banned Melonie's Avatar
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    Default Re: just started dancing...should I pay taxes?

    It's something about how the IRS isn't technically part of the US government so you can't be forced to pay them. I'm sure Mel can enlighten us more about this.
    Well, there is a small but determined group of citizens out there who follow the school of thought that the historical legislation which created an underlying gov't 'right' to tax the 'incomes' of 'citizens of the 50 US states' is in fact unconstitutional. The entire saga of the creation of the US Federal Income Tax, from the first unsuccessful attempt in 1896 to FDR's implementation of a 'temporary' wartime federal income tax withholding and payment system during WW2 which essentially created the system as we know it today, is an interesting read ...



    Regardless of any theoretical legal possibilities that our present income tax system may actually be constitutional or unconstitutional, realistically speaking we'll never be able to find out, because not even Warren Buffett has enough billions to flog that issue all the way through the courts successfully.

    Realistically speaking, our gov't and the social/economic structure of much of the country depends on the existance of an income tax. Therefore, if the income tax 'dam' should ever spring a major 'leak' via people actually being allowed to not pay income tax and get away with it, very soon the country would be in revolt as there would soon be no money in the 'reservoir' to pay for welfare benefits, medicaid, social security benefits, not to mention civil servants' paychecks i.e. schoolteachers and cops ! The vast majority of Americans today could simply not survive in an America 'rewound' to 1912, when everyone was truly required to pay their own way (income taxes were formally enacted in 1913). Therefore by whatever means necessary the Federal Income Tax (as well as state income taxes) is here to stay.

    Realistically speaking, the IRS says you have to pay income taxes. Realistically speaking, the IRS has the power to freeze and/or confiscate a person's assets, and to throw a person in jail for failure to pay income taxes. Therefore anybody who persists in acting as a 'tax protestor', i.e. not paying their income taxes, should be prepared for the day that the IRS catches up with them and does exactly that !

    And don't believe the figure cited by the author of the article I linked to that some 40% of Americans don't file and pay income taxes. I would guess that the figure is more like 0.4%, with the vast majority of that number looking over their shoulder.

    ~
    Last edited by Melonie; 03-15-2005 at 03:42 AM.

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    Member Jon_CPA's Avatar
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    Default Sorry this is long but,

    Authority to tax:

    The government’s authority to tax is granted Article 1 Section 8 Clause 1 of the U.S. Constitution States:



    The Congress shall have the power To lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defense and General Welfare of the United States; But all Duties, Imposts and Excises shall be uniform through out the United States.



    The constitutional limitations placed upon the government’s authority to tax are defined in Article 1 Section 9 Clauses 1, 4, and 5:



    (1) The Migration or Importation of such Persons as any State now existing shall think proper to admit, shall not be prohibited by the Congress prior to the Year one thousand eight hundred and eight (1808 ), but a Tax or duty may be imposed on such Importation, not exceeding ten dollars for each Person.



    (4) No Caption, or other direct, Tax shall be laid, Unless in Proportion to the Census or Enumeration herein before directed to be taken.



    (5) No Tax or Duty shall be laid on Articles exported from any State.





    Types of taxation:

    What the Constitution created was two types of taxes, Direct and Indirect classes and how those classes of taxes were to be treated or limited.



    Direct taxes are taxes upon persons or objects. A property tax is a direct tax upon the physical property. A flat tax of $100 per individual is a direct tax on the individual. The Constitution places a limitation that direct taxes must be in proportion to the Census. If the Federal government wanted to create a property tax then the revenues collected from each state would have to be proportionate to the last census figures. This means that a large sparsely populated state like Alaska would have a very low tax rate per acre, versus a small densely populated state like Massachusetts would have a high tax rate per acre. Direct taxes have to be proportionate across the states not uniform across the states.



    Indirect taxes are not taxes upon an object or person but upon what happens to an object or person. Imposts or Duties are taxes upon the transference of the object; Estate tax is an impost tax on the transference of wealth. An excise tax is a tax upon an action such as manufacturing or selling an object. While most people consider a sale a transfer that is incorrect, if you give the object for free, a transfer has occurred, but a sale has not. The Constitution requires that indirect forms of taxation do not have to be proportionate across the states but must be uniform across the states. That is why the 18¢ a gallon fuel tax is the same in Georgia as it is in California even though California may consume a disproportionate amount of gas.



    Income tax pre February 3, 1913.



    In 1894 The U.S. Congress passed the its first income tax. By April 8, 1895 the constitutionality of the income tax was being tried in the case Pollock v. Farmers’ Loan & Traust Co. et al (sic.). Farmers’ Loan & Traust Co. (sic.) was withholding 2% of the profit earned in 1894 and remitting it to the government on behalf of the shareholders of the company. The earnings included rents on real estate and interest on bonds from the city of New York. Pollock was challenging the constitutionality of the income tax on the grounds that the income was a direct tax and therefore should have been leveled in a proportionate manner not a uniform manner. Pollock’s attorneys argued that the rents and interest were an inherent and inseparable part of the real estate and bonds and thus made any tax on the income from the real estate or bonds a tax on the objects themselves. The U.S. Supreme Court sided with Pollock and ruled that since the income tax did not meet the constitutional requirement on apportionment in regards to income from the real estate and bonds that the law was unconstitutional.



    After the ruling on the Pollock v. Farmers’ Loan & Traust Co. et al (sic.) The U.S. Congress was limited to placing income taxes only on those sources of income that could be separated from the objects that created the revenue. Income from the sale of goods is separable from the goods, but income from services was not separable from the person who performed the services. Under an excise tax the performance of the service was taxable but the excise tax cannot distinguish between services performed for fees or services performed for personal use. Example, an excise tax of $10 per ditch can be leveled for digging a ditch, but whether you dig the ditch in your neighbor’s yard for $20 or you dig it in your own yard to burn trash you still had to pay $10.



    Income tax post February 3, 1913



    On February 3, 1913 the 16th amendment to the constitution was ratified. The 16th amendment states:



    The Congress shall have the power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration.



    In 1913 the U.S. Congress reinstituted the income tax.



    In 1914 the constitutionality of the income tax was challenged again in Frank R. Brushaber Appt. v. Union Pacific Railroad Company. The attorneys for Brushaber contended that the 16th amendment did not alter Article 1 Section 9 Clause 4 of the Constitution of the United States. Arguing under the precedent of Pollock v. Farmers’ Loan & Traust Co. et al (sic.), the attorneys stated that income inseparable from the object or person is still a direct tax of that person or object. As such the effect of 16th amendment was to create a direct tax that is not subject to the restrictions of apportionment, in direct contradiction of Article 1 Section 9 Clause 4, and that is not subject to the rules of uniformity that is imposed on taxes that are indirect taxes since it is a direct tax. The attorneys requested that the income tax be declared unconstitutional on two grounds; One that no law can be both in and out of compliance with the Constitution of the United States and; Two the ability to create a tax that is neither subject to the rules of apportionment and the rules of uniformity is against the intent of the framers of the constitution.



    The ruling of the U.S. Supreme Court agreed that no law can be both in and out of compliance with the Constitution of the Untied States. That Article 1 Section 9 Clause 4 of the Constitution remains unaltered by the 16th amendment. Furthermore, that all tax laws must comply with the rule of apportionment if a direct tax, and conform with the rule of uniformity if it is an indirect tax. However, the court ruled that the income tax is constitutional. The court ruled that the phrase “without apportionment among the several States, and without regard to any census or enumeration”, in the 16th amendment, rules out the income tax from being a direct tax and in effect defines it as an indirect tax subject to the rules of uniformity. Furthermore, the court decision ruled that the phrase “from whatever source derived” has invalidated the precedent set in the of Pollock v. Farmers’ Loan & Traust Co. et al (sic.) ruling; it no longer matters whether the income generated is inherent of or independent of the object or person creating it.



    The positions of the courts since the Frank R. Brushaber Appt. v. Union Pacific Railroad Company ruling has been that the income tax is an excise tax. Since an excise tax is a tax on an action the court has taken the position that the action is the creation of wealth. The courts has given the legislature the power to define by law what is “the creation of wealth” or income, when such creation occurs, and how such income is to be taxed. That is the constitutional principle that is the basis for the Internal Revenue Code and the Department of Treasury Regulations.

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    Banned Melonie's Avatar
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    Default Re: just started dancing...should I pay taxes?

    nice work, Jon ! Thanks.

    BTW, one of the major tenets of the 'tax protester' group is that the 16th amendment was in fact not ratified.

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    Default Re: just started dancing...should I pay taxes?

    I have two strong philosophies on paying taxes. First of all, the people who claim that it is illegal for the government to tax us are morons. If you are going to stick to that argument then the judge is just going to laugh in your face when he sentences you for income tax evasion. This all being said, it truly is our duty as American citizens to pay what we are supposed to pay in taxes. We want the benefits of living here, we should be paying our fair share and be HAPPY to do so. I'm not thrilled about writing a check to the IRS every year, and at the same time I'm thrilled to be able to live in this country and have the benefits that my taxes pay for. Not all of them mind you, but most.

    Second, understanding philosophy #1 above, I also think it is our duty as citizens to use every sing law that the government allows us to maximize our deductions on our taxes as well. Along with the laws making us pay taxes are laws that allow us to minimize those payments as well. My advice is to pay your taxes, and also find an awesome accountant that will help maximize the money you can keep.

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    Things may come to those who wait, but only the things left by those who hustle. ~Abraham Lincoln

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    Default Re: just started dancing...should I pay taxes?

    Thre words for you...

    Pay your taxes.
    Marilu

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    Default Re: just started dancing...should I pay taxes?

    Quote Originally Posted by LatinaDancerNJ
    Thre words for you...

    Pay your taxes.
    Looks like my '04 FIT liability will wind up in the mid five figures. Trust me, if there was a way around paying the piper I would find it. Unfortunately, my business leaves a huge papertrail.

    FBR
    Once again I have embraced my addiction and have put off the moral dilemma to another day.

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    Default Re: just started dancing...should I pay taxes?

    First... did they photocopy your i.d.? If the club is ever audited you'll be too! Bite the bullet and pay your taxes. You'll be able to invest and spend above the table. Good luck!

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    Banned Melonie's Avatar
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    Default Re: just started dancing...should I pay taxes?

    As Chantell points out, if at some point a dancer has provided the club with a filled out and signed job application, or even a photocopy of her personal ID, that info will be sitting in the club's files. If the IRS or any other gov't agency is given a reason to go looking, that job application or ID photocopy will lead straight to you.

    Also, if your name (even just your stage name) appears on club work schedules and/or private dance ledgers, this info will also potentially reside in club files. Thus where the job application or ID photocopy can be used to prove that you worked for the club, the work schedules and/or private dance ledgers can be used to prove how often you worked.

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