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Thread: i got money from a benefactor....

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    Default i got money from a benefactor....

    as a gift. its a check. do i put it in the bank? or should i talk to my benefactor/sugardaddie and have him give me cash? also how do i account for it in taxes?

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    God/dess montythegeek's Avatar
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    Default Re: i got money from a benefactor....

    A gift is not taxable for the recipient--the giver owes any gift tax if it exceeds the threshold of $11,000/year.

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    Banned Melonie's Avatar
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    Default Re: i got money from a benefactor....

    However, there is IRS precedent that sizeable 'gifts' received by dancers from 'benefactors' have in the past been considered to be taxable income in exchange for 'services rendered'. From this standpoint, having a record of sugar daddy's checks and the resulting bank deposits certainly creates more of a paper trail than cash payments.

    As to how you treat these 'gifts' from a tax standpoint, that is directly related to how sugar daddy treates these 'gifts' from his own tax standpoint. If sugar daddy is declaring the payments to you as gifts and paying gift tax himself, then you can indeed treat them as non-taxable gifts. If, however, sugar daddy is treating these 'gifts' as incidental business expenses, then to be consistent you must treat the money as taxable income.

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    Default Re: i got money from a benefactor....

    so i can just deposit these gifts in the bank and my sugardaddie will just have to worry about paying taxes on it?

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    Banned Melonie's Avatar
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    Default Re: i got money from a benefactor....

    Quote Originally Posted by SilverScreenStarlet
    so i can just deposit these gifts in the bank and my sugardaddie will just have to worry about paying taxes on it?
    Again, it depends on how sugar daddy chooses to report the 'expenditure' from his end. If he attempts to take a business expense deduction and calls this gift an 'entertainment expense', then odds are you must treat it as taxable income and pay taxes on the money yourself. If on the other hand sugar daddy reports the 'expenditure' as a gift, and if sugar daddy pays any applicable gift tax, then you can indeed treat the money as a non-taxable gift.

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    Default Re: i got money from a benefactor....

    What if it's a tax write off???How does that work???
    One of woman's cardinal rule: Body parts can be fake,everything else has to be real.

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  7. #7
    AudreyLeigh
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    Default Re: i got money from a benefactor....

    If you take it to his bank to cash and its under I believe $5000 it leaves less of a papertrail...

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    Banned Melonie's Avatar
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    Default Re: i got money from a benefactor....

    Quote Originally Posted by onlythebest
    What if it's a tax write off???How does that work???
    In this case, the money that sugar daddy is spending on you is legally being spent by his business, and is being deemed an 'entertainment expense' or a 'promotional expense' or something similar on his business' books. As such, sugar daddy can deduct it from his own business income and reduce his own income taxes. However, if this is in fact how the transaction is going down, then if daddy or yourself are ever audited the money paid to you will almost certainly be considered as taxable earned income to you by the IRS, on which you owe income taxes.

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    God/dess onlythebest's Avatar
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    Default Re: i got money from a benefactor....

    Oh,OK.Thanks Mel.
    One of woman's cardinal rule: Body parts can be fake,everything else has to be real.

    一个女人的枢机规则:肢体可以伪造,一切必须真实.

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    Default Re: i got money from a benefactor....

    how do i know if this is a business expense or just a gift hes giving me.

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    God/dess FBR's Avatar
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    Default Re: i got money from a benefactor....

    All the money I give to my fav is from after-tax income. I dont have the balls to try and write her off.

    To the OP...try and insist on cash. If he can finagle you as a petty cash "Office Supply" expense more power to him. As long as there is no paper trail to you, I dont think you have to worry about it.

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

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    God/dess Deogol's Avatar
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    Default Re: i got money from a benefactor....

    Quote Originally Posted by SilverScreenStarlet
    how do i know if this is a business expense or just a gift hes giving me.
    If it is a company check, he will need to account for it on the company books.

    If it is a personal check then I would say you don't have to worry about it being a tax write off on his part.

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    Default Re: i got money from a benefactor....

    Quote Originally Posted by SilverScreenStarlet
    how do i know if this is a business expense or just a gift hes giving me.

    As others have said, you will have to ask him if he claimed the money as a tax deduction or if he treated it as a gift (or just did not file) for tax purposes.

    If you both ignore this, it may go away, or years from now, the IRS and state may determine you or he owes taxes (and you wont have any of that money left to pay it with). You have to know this.

    I think you will have to re-read this whole thread or have a friend explain it to you if it is not clear yet.
    I loved going to strip clubs; I actually made some friends there. Now things are different for the clubs and for me. As a result I am not as happy.

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    God/dess threlayer's Avatar
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    Default Re: i got money from a benefactor....

    The IRS requires bank (or credit union) amounts in excess of $5000 to be reported, but the reporting records are more extensive if the amount is $10,000 and over.

    Further, the bank will require extra procedures just to cash the check of a large size, especially if you want the amount in cash. It may be better to deposit it in a new account, though it will be tracked. I hope someone more knowledgeable in this area will comment on my thoughts here.
    I loved going to strip clubs; I actually made some friends there. Now things are different for the clubs and for me. As a result I am not as happy.

    Customers are not entitled to grope, disrespect, or rob strippers. This is their job, not their hobby, and they all need income. Clubs are not just some erotic show for guys to view while drinking.

    NOTE: anything I post here, outside of a direct quote, is my opinion only, which I am entitled to. Take it for what you estimate it is worth.

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    Default Re: i got money from a benefactor....

    Presumably, if the guy owns a business and has that kind of money to throw around, he wouldnt be stupid enough to post payments to you on his books as business expenses.

    Someone asked whether it was a company or personal check. Most business owners dont pay for personal expenses with company checks, especially if they are incorporated. It just looks messy on the books and the CPA's frown on it. But said owners can if they want to as long as they dont claim those expenditures as business expenses. I could go to Best Buy, pick out a $1000 TV and write a company check for it (assuming the store would accept the check). As long as I dont try to show it as a busines expense, the corporation is paying taxes on that $1000. The IRS is happy.

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

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    Default Re: i got money from a benefactor....

    if he pays via personal check what happens then? are u sure i dont have to report taxes?

    also if i do decide to pay taxes, should i write down that i got such and such amount as a gift to be on the safe side. would i need to do anything else?

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    Senior Member DanMorris95156's Avatar
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    Default Re: i got money from a benefactor....

    I have been asked to review this thread - accordingly here are my comments. The 12,000 pound elephant in the room is the tax treatment of gifts that have clear "tip" type connotations.

    Gifts of deminims (small) value aren't an issue and clearly that would be small gifts of say under a $100 or so (IRS would suggest $25) - but a gift of perfume as a token of appreciation, friendship, thanks, etc. isn't the issue. A gift of $5k, etc. on the other hand is more clearly a "tip" that is probably business related. Exceptions include people who voluntarily tell you that they are reporting the gift on a gift tax return and at times of death or extreme situations.

    This is different then say a parent giving a $5k or even $11k gift at the holidays in part of an estate program and/or annual gifting - as there is not "professional relationship involved.

    A customer of a Dancer, escort, etc. that provides significant cash "gifts" will be considered taxable income under audit and it would be difficult to demonstrate that it wasn't.

    If the gift is in the form of a check - even more difficult. If the gift is "cash" you might float it but recogize the size of the gift has to be reasonable or you will lose the argument.

    If the gift is like use of property (a vacation home, etc.) that is different. I adavise you all to treat gifts like these with an eye toward caution and let the facts and cicrumstances determine your taxable aspects. This may be time for a professional consultation - just so that you can demonstrate that the fact patterns fit the tax methods claimed.

    Regards,

    Dan Morris
    Daniel D. Morris, CPA
    [email protected]

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