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IRS Sex workers taxes

Identity Protection PIN Program will soon be available to taxpayers nationwide

In January, the IRS Identity Protection PIN Opt-In Program will be expanded to all taxpayers who can properly verify their identity.
An identity pretention PIN is a six-digit number assigned to eligible taxpayers to help prevent their Social Security number from being used to file fraudulent federal income tax returns. This number helps the IRS verify a taxpayer’s identity and accept their tax return. The online Get An IP PIN tool immediately displays the taxpayer’s assigned number.
This tool uses Secure Access authentication verify a person’s identity. Taxpayers should review the Secure Access requirements before they try to use the Get An IP PIN tool.
Other ways to get an IP PIN
There are other ways to get an IP PIN if someone is unable to pass the Secure Access authentication. Taxpayers with income of $72,000 or less should complete Form 15227 and mail or fax it to the IRS. An IRS employee will call the taxpayer to verify their identity using a series of questions. Those who pass authentication will receive an IP PIN the following tax year.
Taxpayers who cannot verify their identities remotely or who are ineligible to file Form 15277 should make an appointment, visit a Taxpayer Assistance Center and bring two forms of picture identification. This is an in-person identity verification. After the taxpayer passes authentication, an IP PIN will be mailed to them within three weeks.
Taxpayers should never share their IP PIN with anyone but their tax provider. The IRS will never call to request the taxpayer’s IP PIN, and taxpayers must be alert to potential IP PIN scams.

Here’s what taxpayers need to know before applying:
• The Get an IP PIN tool will be available in mid-January.
• This is the preferred method of obtaining an IP PIN and the only one that immediately reveals the PIN to the taxpayer.
• Taxpayers who want to voluntarily opt into the IP PIN program don’t need to file a Form 14039, Identity Theft Affidavit.
• The number is valid for one year. Each January, the taxpayer must get a new one.
• It must be entered correctly on electronic and paper tax returns to avoid rejections and delays.
• Taxpayers with either a Social Security Number or Individual Tax Identification Number who can verify their identity are eligible for the program.
• Any primary or secondary taxpayer or dependent can get an IP PIN, if they can prove their identity.
• The IRS plans to offer an opt out feature to the IP PIN program in 2022.
Confirmed victims of tax-related identity theft
There is no change in the IP PIN Program for confirmed victims of tax-related identity theft. These taxpayers should still file a Form 14039 if their e-filed tax return rejects because of a duplicate SSN filing. The IRS will investigate their case and once the fraudulent tax return is removed from their account, they will automatically receive an IP PIN by mail at the start of the next calendar year.
IP PINs will be mailed annually to confirmed victims and participants enrolled before 2019. For security reasons, confirmed identity theft victims can’t opt out of the IP PIN program. Confirmed victims also can use the Get an IP PIN tool to retrieve lost IP PINs assigned to them.

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Sex workers

Get Ready for Taxes: Steps to take now to make tax filing easier in 2021

IRS
WASHINGTON – The Internal Revenue Service today encouraged taxpayers to take necessary actions this fall to help file federal tax returns timely and accurately in 2021.
This is the second in a series of reminders to help taxpayers get ready for the upcoming tax filing season. A special page, updated and available on IRS.gov, outlines steps taxpayers can take now to make tax filing easier in 2021.
2020 has been a busy year, with a lot of changes. To make sure taxpayers don’t miss out on tax benefits or make mistakes, they can take a few simple steps now to make filing their taxes easier in 2021.
An important first step to getting taxes ready is to gather all tax records. Having records organized makes preparing a tax return easier. It may also help discover potentially overlooked deductions or credits.
• Most income is taxable, so taxpayers should gather income documents such as Forms W-2 from employers, Forms 1099 from banks and other payers, and records of virtual currencies or other income. This also includes, unemployment income, refund interest and income from the gig economy.
• Beginning in 2020, individuals may receive Form 1099-NEC, Nonemployee Compensation, rather than Form 1099-MISC, Miscellaneous Income, if they performed certain services for and received payments from a business. Please refer to the Instructions for Form 1099-MISC and Form 1099-NEC to ensure clients are filing the appropriate form and are aware of this change.
• Taxpayers may also need Notice 1444, Economic Impact Payment, which shows how much of a payment they received in 2020. This amount is needed to calculate any Recovery Rebate Credit they may be eligible for when they file their federal income tax return in 2021. People who didn’t receive an Economic Impact Payment in 2020 may qualify for the Recovery Rebate Credit when they file their 2020 taxes in 2021.
• To see information from the most recently filed tax return, recent payments and more taxpayers can sign up to view account information online.
• Taxpayers should notify the IRS of address changes and notify the Social Security Administration of a legal name change to avoid delays in tax return processing.
Taxpayers with an Individual Tax Identification Number (ITIN) should ensure it hasn’t expired before filing a tax return in 2021. For example, ITINs not used on a federal tax return at least once in the last three years will expire on Dec. 31, 2020. If the ITIN has expired, IRS recommends taxpayers submit Form W-7, Application for IRS Individual Taxpayer Identification Number, now to renew an ITIN. Taxpayers who fail to renew ITINs before filing a tax return next year could face a delayed refund and may be ineligible for certain tax credits.
Time is running out to use the Tax Withholding Estimator, a tool on IRS.gov designed to help determine the right amount of tax to have withheld from paychecks. Taxpayers can use the Tax Withholding Estimator to help determine if adjustments to withholding are necessary. Withholding changes can be made by submitting a new Form W-4 to the taxpayer’s employer.
Taxpayers receiving substantial amounts of non-wage income like self-employment income, investment income, taxable Social Security benefits and in some instances, pension and annuity income, should make quarterly estimated tax payments. The last payment for 2020 is due on Jan. 15, 2021. Payment options can be found at IRS.gov/payments.

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IRS Sex workers taxes

IRS to resume sending balance-due notices despite pandemic

IRSThe Internal Revenue Service said Friday it would restart issuing its 500 series of balance-due notices to taxpayers later this month after they were paused on May 9 due to the COVID-19 pandemic.

While the IRS continued to issue most of its notices, the 500 series was temporarily suspended because of a backlog of mail that built up at the IRS while many employees were away from agency facilities due to COVID-19. The IRS came under fire earlier this year for issuing balance due notices with the incorrect dates to taxpayers during the pandemic and agreed to stop sending the notices until it caught up with its backlog of unopened mail.

If you get a letter from IRS that states you owe money we can help. We do a lot or IRS case resolution.  Contact us if you receive an IRS letter. info @ sexworkertaxes.com

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IRS Sex workers taxes

Most taxpayers who requested an extension to file must file today

Today is the filing extension deadline. Most taxpayers who requested an extension of time to file their 2019 tax return must file today.
Those filing today who also owe taxes should pay as much as possible to reduce interest and penalties. The extension of time to file is not an extension to pay. Taxes must be paid on the original due date to avoid any penalty and interest charges.
Here are a few resources on IRS.gov to help last-minute filers:
• Filing for individuals
This page includes a link to IRS Free File, which is available through today. IRS e-file is easy, safe and the most accurate way to file taxes.

• Paying taxes
Taxpayers should visit IRS.gov/payments to choose a payment option. They can pay online, by phone or with their mobile device and the IRS2Go app.

• Viewing account Information
Individual taxpayers can visit IRS.gov/account to view their taxes owed, payment history and key information from their most current tax return as originally filed.

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IRS Sex workers taxes

IRS extends Economic Impact Payment registration deadline for non-filers to Nov. 21

The deadline to register for an Economic Impact Payment using the Non-Filers tool is extended to November 21, 2020.

The IRS urges people who don’t typically file a tax return – and haven’t received an Economic Impact Payment – to register as quickly as possible using the Non-Filers: Enter Info Here tool on IRS.gov. The tool will not be available after November 21.
This additional time is solely for those who haven’t registered or received their EIP and don’t normally file a tax return. For taxpayers who requested an extension of time to file their 2019 tax return, that deadline is Thursday, October 15.
Most eligible U.S. taxpayers automatically received their Economic Impact Payment. Others who don’t have a filing obligation need to use the Non-Filers tool to register with the IRS to get up to $1,200. Typically, this includes people who receive little or no income.
The Non-Filers tool is secure. It is designed for people with incomes typically below $24,400 for married couples, and $12,200 for singles who could not be claimed as a dependent by someone else. This includes couples and individuals who are experiencing homelessness.
Anyone using the Non-Filers tool can speed up the arrival of their payment by choosing to receive it by direct deposit. Those not choosing this option will get a check.
Beginning two weeks after they register, people can track the status of their payment using the Get My Payment tool, available only on IRS.gov.

 

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IRS Sex workers taxes

Here’s What Happens If You Don’t Do Your Taxes

You, yes you, can do your taxes this year. Many of you are done, most of you haven’t started, and a few of you are freaking out. Some of you are thinking: what if I just don’t file? What will happen if I don’t pay? What if I didn’t file last year or the year before that? What will they do to me and will I be in prison with Wesley Snipes?

I have some answers to those questions! You should note that I am not a tax professional, that this is definitely not professional advice and that every situation is unique. Also you should be doing your taxes right now probably, not reading the Internet. But here’s some experience, offered person-to-person, that is not professional counsel.

It is better to do a cruddy job and file than to not file.
When I say “cruddy job,” I don’t mean “making wild guesstimations” or being dishonest. I mean: If you can’t nail some stuff down, forget about it and move on. For instance: Do you not have receipts for some expenses? Big deal: cut them out and forget about it. (These small expense-deductions don’t generally have too much effect on your tax burden anyway.) Err on the side of “hurting” yourself and just plow through it. It’s just not worth making yourself crazy over fifteen bucks!

You can fix your return!
It is easy to amend a return. It’s also easy for the IRS to amend your return: “You do not need to file an amended return due to math errors. The IRS will automatically make that correction.” Intense, right?

It is better to file and not pay than to not file and not pay.
What happened, you spend all your money? That’s okay, pal! Do your taxes, send ’em in, if you have absolutely no money. You will incur not-totally-crazy penalties over time due to not paying, and they will want to talk to you about when you can pay. (Yup, it’s always the broke people that have to pay more in this world.) That’s not ideal, sure! But it’s a lot more ideal than not having filed.

Okay, but should I be scared of the IRS?
The IRS only wants to hear from you. The answer, surprisingly, is a very firm “no”! Not at all! The IRS has some of the nicest, most understanding people I have ever spoken with in my life. True fact.

There’s a lot of TV- and movie-propagated terror about the IRS. (As well, the whole idea of the government and money is anxiety-producing on its own, sure.) And the truth is… well, they kind of used to be a little mean? But that’s actually ancient history. The people at the IRS are some of the funnest people ever! I have had long hilarious conversations with them on the phone. (For real, there are some hilarious ladies down in Atlanta.) IRS employees are like most civil servants; they deal with confused, freaked out and sometimes very dingbatty people (not you, friend!) every day — the kind of people who do not follow directions, particularly. So if you are not a jerk, they will be delighted to speak to you, at length. They will sometimes be like, “Girl, how did you get into this trouble?” and you’ll be like “Oh, haha, I’m a mess! Mistakes happen!” and they’ll be like, “I hear you! I get it!” Do not be afraid. What they want is to hear from you.

Should I be scared of my state tax department?
Actually… well, maybe just a little. The same rules apply as above — they do want to hear from you! — but, for instance, the New York State Department of Taxation and Finance seems to be a little cranky. They want their money, they want it now, and if you don’t give it to them, they will take it. I’m sure there are some wonderful, caring people working in all of America’s fine state tax departments!

What happens if you don’t file?
Have I mentioned that the IRS only wants to hear from you?

No really, what happens if you don’t file and don’t pay?
Great news! Eventually the IRS will do your taxes for you. This is called a substitute return. Doesn’t that sound nice? Well it’s not particularly. For an agency that’s devoted to taxes, they don’t do a very good job at it. (Kidding.) So the good news is that your taxes will be done! The bad news is that they will take your reported income, slot it into the appropriate tax bracket, and say you owe that percentage. So if you made $85,000, bam, you owe 28%.

Also? Lots of people can’t deal with taxes when they’re even going to get money back! People are funny. But you should know that your refund disappears in three years if you don’t file.

What happens if, like, I ignore the IRS?
Well, you’ll get a ton of mail. And the problem with being “in trouble” is that your sense of being in trouble fades really fast. That’s how people are built. Most people pay taxes because they’re scared of the consequences. So, you don’t file one year, and then… nothing that terrible happens! So you’re off to the races. And then you get a scary piece of mail from the IRS, and you ignore it, and… nothing terrible happens again! It’s very easy for the human mind to acclimate to this.

And then, they will make it so that you can’t ignore them. (For instance, your debit card will stop working! Heh.) You should head that off at the pass. The moral being: even if you aren’t scared of the consequences now, you will be later.

Ugh, they sent a letter to everyone I’ve ever worked for! How humiliating!
Nah, it’s not. Years ago, the IRS sent out a letter to people who’d paid me money, informing them they had an interest in having that money for themselves. And half the people who got these letters — caring, decent, professional, adult-type people! — were like “Ha, I got one of these letters last year!” It was a moment of bonding. To be fair, one person was a little judgmental, but you are by no means alone in these issues.

So how do I work out paying if I haven’t paid?
You know how GE and Bank of America don’t pay any taxes? That happens because they’re well-advised. You too should be well-advised. Down the road, if you end up in debt with the IRS, you will likely have a couple of options — usually Offer in Compromise or Payment Plan. These are actually not terribly straightforward. For instance, you can work out a payment plan with the IRS, after filling out quite a lot of paperwork, and having your financial life pretty well-surveilled by them, but the IRS is actually required to ensure that you have enough money and income to meet the payment plan. (They can’t agree to a payment plan that’s onerous.) But that doesn’t mean that, even if you are on an installment plan, that penalties don’t continue to accrue! So, many people find that they’re often better off getting a bank loan. And Offer in Compromise is extremely complicated. With those, for instance, you cannot miss a yearly tax payment for at least the next five years, or the deal is off. So you are going to need to become an expert — but more importantly, you’re also going to need to consult with a real expert.

Ugh, I don’t know what to do!
Guess what? The IRS only wants to hear from you. Also? These things are never as bad as you think. Now go off to your quiet place and do your taxes. I can promise you’ll be happy you did.

HELP I’M PANICKING!
Lots of online tax products are free to use to file an extension. If you can’t do ANYTHING else at all, do that.

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IRS Sex workers taxes

Five Reasons Sex Workers File Their Damn Taxes

1) Tax returns are the only proof of income you have if you’re self-employed and paid mostly, if not entirely, in cash.

2) It’s far better for the IRS to have your numbers to start with than to let them come up with their own.

3) If you get caught after not paying taxes for a number of years and get hit with a five-figure bill, it really sucks.

4) You become another person contradicting the stereotype of sex workers as tax cheats who don’t contribute to society.

5) It makes you (even more) morally superior to GE.

Things you need to file if you are an independent contractor stripper/model/performer/camgirl, an escort, sensual touch provider, etc:

Form 1040
Schedule C for income from a business (you are a business)
Form 8829 for home office deduction (you have a computer in your home where you’re doing business, yes?)
Your receipts for work-related supplies, travel, and other expenses
Records of your income

Even if you lack accurate records, give it your best shot and file. Even if you can’t pay right now, file. Even if what you do is illegal, file (you don’t have to write down what you do. We are all “entertainers”). Read this piece over at the Awl for some good reasons why you should file no matter what. It’s so, so much better to have YOUR realistic numbers than to have the IRS say, “Hey, we have this 1099 from your club, where you sold $1500 in VIP rooms, so we’re assuming that was a normal night for you, so we’re calculating your tax debt based on that,” or “Well, we saw on this 20/20 special about escorts that $2000/hour is a rate people pay in New York, so let’s start there.”

I don’t care if you’re gonna fudge it! Don’t tell me about it. Don’t tell anyone about it, for that matter. I’m not telling you to file because I think we owe it to the country or because I’m a bleeding-heart liberal or because I think the Tea Party is supremely misguided because they aren’t storming the gates of GE and Bank of America to demand they bear their burden of the tax load. I’m telling you to do this because it COVERS YOUR PRETTY PROFESSIONALLY SEXY ASS. Having personally fucked up with taxes before and knowing several dancers and escorts who’ve been in deep shit with the revenuers, I speak from experience when I say it’s to your advantage to stay on top of your taxes.

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IRS Sex workers taxes

You’re A Sex Worker — How Do You Pay Your Taxes?

If your work is illegal, do you still pay your taxes? How do you deposit large amounts of cash without alerting the IRS? Alongside standard financial talk of high-yield investments and Excel spreadsheets, the Tumblr Sex Worker Helpfuls addresses a more specific set of questions like these. It’s one of several sex worker-run websites and message boards that offer financial advice to strippers, cam girls, sugar babies, dominatrices and escorts about everything from STIs to personal safety—and money is a popular subject.

“In the old days, it was the kind of things you might talk about to other girls if you worked in a brothel together or at an escort service,” says Maggie McNeill, a sex worker who has been in the business for 18 years and runs the blog The Honest Courtesan. “Nowadays, you strike up friendships on [message] boards and talk to each other.”

It’s no wonder that finances attract special concern. “The illegitimate and stigmatized nature of this work makes handling money feel really dicey and kind of stressful,” said Savannah Sly, president of the social justice organization the Sex Workers Outreach Project. It’s also why sex workers are sometimes excluded from the mainstream financial industry. Things that so many people take for granted, from having a bank account to taking out a car loan, can be difficult and unnerving, if not outright impossible, propositions—and they often require guidance.

The most fundamental issue is how to deal with large amounts of cash, particularly in escorting. Checks, which are unreliable and can reveal a sex worker’s identity to their clients, are generally off-limits as a form of payment. Many online payment services, like PayPal, have policies against “certain sexually oriented materials or services,” and you better believe sex worker Tumblrs are keeping a running tally of which services are sex worker friendly. Fiona Stone, who runs Sex Worker Helpfuls, says the most frequent financial questions she gets is about whether PayPal and similar services are “a good, safe option”—she says they aren’t. Some online payment processors have even seized sex workers’ accounts and put a hold on their funds. Earlier this month, a court ruled that PayPal customers who have had their accounts frozen might be entitled to settlements, but that hardly changes these companies’ policies.

This leaves cash as the best option, and cash can be dangerous.

Kate D’Adamo, national policy advocate at The Sex Worker’s Project, says policies like PayPal’s further marginalize sex workers and push them into “more and more isolation and into more and more vulnerability.” She explains, “If someone knows you work in the sex trade, they know you probably have money in your house, so you’re that much more likely to get robbed,” she said. “Having to be paid in cash because you can’t use PayPal means that you’re walking home at night or getting in a cab somewhere with five-hundred dollars on you.” And, of course, if a sex worker is robbed, he or she is likely less comfortable reporting it to police.

“I try not to keep that much (cash) on hand so that I can afford to lose it,” says McNeill. “I have a safe, it’s not a big one, I don’t want to keep around more than I can fit in that safe.” The sex work blog “good girls don’t” advises, “one thing you should invest in is a good fire-proof safe.” The post goes on to recommend, “Don’t hide cash in obvious places, like your mattress, the freezer, your toilet tank, and so on. If you’ve seen it in a movie, other people have, too.”

Of course, sex workers can always deposit cash in banks accounts, and many do, although as the “good girls don’t” post warns, “anything you deposit in a bank account, pay bills with, or buy large items with leaves a paper trail.” That can be of special concern when engaging in illegal sex work.

That’s not to mention the hazards in any line of sex work when dealing with bank tellers. “There’s not a lot of people who operate in cash so you’re considered to automatically be suspect if you are operating in cash,” said Sly. She still gets clammy going to the bank to make deposits. “I constantly feel like I’m gonna get busted,” she said. It doesn’t help that tellers, male ones in particular, tend to make jokes about large amounts of cash—things like, “Big night at the casino, huh?”

“I try to avoid people and use ATMs,” she said.

On top of that heap of financial burdens, there’s the additional distrust among sex workers of the banking industry as a whole. In 2014, Chase shut down the accounts of several high-profile porn performers, calling them “high risk.” The company denied that it was because of the nature of their professions, although many sex workers remain skeptical. Credit card companies have limited how sex workers can spend their money, too: Last year, responding to threats made by Sheriff Tom Dart of Cooks County, Illinois, Visa and MasterCard stopped processing payments for adult ads posted to the classified site Backpage.com. (Late last year, an appeals court ruled that Dart’s actions violated First Amendment rights.)

Of course, all of this cash tends to raise questions about taxes. It’s a frequent topic across sex worker advice sites, and the message is almost always: do them. “It’s that old principle of ‘only break one law at a time,’” said McNeill. As a post on Sex Worker Helpfuls, which is re-blogged from another site, puts it, “You don’t want to get hit with a six figure bill and/or jail time at some point over the next few years because you weren’t doing your taxes.”

The post goes on to detail necessary forms—1040 for an individual tax return, Schedule C for business income and 8829 for a home office deduction—and the need for income records. “Even if you lack accurate records, give it your best shot and file. Even if you can’t pay right now, file,” it reads. “Even if what you do is illegal, file (you don’t have to write down what you do. We are all ‘entertainers’).”

Other posts provide tips on recording income and offer up Excel spreadsheets for keeping track of tax deductible expenditures, including makeup. But even with all this guidance it can still be terrifying terrain, especially for those engaging in an illegal trade, and sex worker-friendly CPAs can be hard to come by. One sex worker who asked to remain anonymous told me that after she was upfront with an accountant about the nature of her work, he wouldn’t stop texting her after-hours.

This is why countless Tumblrs recommend Lori St. Kitts, the so-called Tax Domme, who has written the book, ”The Tax Domme’s Guide for Sex Workers and All Other Business People.” She was working as a tax preparer and phone sex operator when she noticed financial misinformation being passed around on sex industry message boards. When she started posting her own tax advice, people asked her to file their returns, and her specialty was born. Now she runs her business alongside her mother, a.k.a. the Financial Madam, under the tagline “bringing your tax liability to its knees.”

“Sex workers are no different than any other business, but their deductions are a bit more interesting,” Kitts said, pointing to questions about things like lube and sex toys. “There is this idea that because they deal in sex that they are all shady and criminals when the truth is that most are just trying to work a legal business under unfair laws and scrutiny.” She says she’s seen “more vanilla businesses try to work around the tax law than sex work businesses.”

In fact, Mistress Matisse, a Seattle-based dominatrix, says she shies away from deductions out of fear. “I do worry a great deal. With my tax guy I’m like, ‘We are declaring this, we are paying taxes on it.’ I’m very conservative about what I deduct.” Her accountant suggested that she write off her home office—because, as she puts it, “half my house is my office”—but she’s too concerned that it will raise a red flag. “There’s a tax on me basically because I can’t bring myself to the attention [of the IRS],” she said.

But, as Matisse found, doing your taxes can be critical for gaining access to other financial tools, like loans. She first started doing her taxes thanks to a client who was an accountant, and then, many years later, a client who was a realtor helped her secure a mortgage. In part because she had a record of her income from paying taxes, she was able to call herself a “self-employed consultant” and get her mortgage application approved. That doesn’t mean the process was easy. “I felt like such a fraud, even though I was like, ‘I know I have the money for this,’” she said. “I swear I lost like seven pounds from the stress during the month when we closed.”

As with any self-employed person—or anyone in a profession that operates in large amounts of cash, like the restaurant industry—it can be difficult to save. Sites like Sex Worker Helpfuls provide pointers and spreadsheets for setting up savings goals, whether it’s for buying a house or for retirement—but an online listicle is not quite as motivating as a relentless HR person who keeps asking about your 401k elections.

McNeill simply planned to live off of her husband’s retirement income, but they have since divorced. “I’m now in position at 49-years-old where I don’t have any savings of any kind,” she said. “I’m faced with a future in which, basically, I’m going to have to keep working one way or another probably for the rest of my life.”

Sometimes, though, people luck out and find a financial mentor: Sly had a friend who helped her open a Roth IRA and Matisse happened to have a client who convinced her to get an IRA. But Matisse emphasizes that this, along with clients who were knowledgeable about taxes and real estate, was total luck. “Our basic financial safety should not depend on that sort of thing,” she said.

Many sex worker rights activists argue that all of these financial burdens—from having to carry dangerous amounts of cash to overpaying on their taxes out of fear—are yet more examples of how criminalization harms sex workers and leaves them more vulnerable. It’s also part of why sex workers have to rely on financial “wisdom … being transmitted though message boards that the government wants to shut down,” as McNeill put it, referring to sites like RedBook, which the feds shuttered in 2014. It had been a place where sex workers both advertised their services and found community with, and advice from, fellow sex workers.

For now at least, there are still sites like Sex Worker Helpfuls. “It’s very important,” said Stone. “[Sex workers] are putting in work all the time to help make our lives less bogged down by a system that gladly takes our money but sneers at how it’s made.”

By Tracy Clark-Flory and Leigh Cuen

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IRS Sex workers taxes

Finances and Sex Work

Starting out or working in the sex industry can be daunting in terms of the financial aspects. Money is coming in, sometimes more than you’ve ever made or even seen before. It can be a bit overwhelming to plan and handle your money. I am not at all a tax professional, financial planner, or really anything but a whore with some experience. This is just advice from me to you, not intended to substitute for professional (well, that kind) advice. It was also not intended to help you avoid the system. Pay your taxes!

First and foremost, you need to plan your budget. How much money do you need to pay rent, utilities, credit card payments, loans, car payments, food bills, and so on? How much money do you need each week or month in order to cover the necessities? Figure this out first. Everything else after this amount is disposable income.

Based on your budget, some market research, and the guidance of other sex workers, calculate your rate. I’m not an expert on this. There are others who can help you, like the book The Internet Escort’s Handbook by Amanda Brooks. Similar principles apply, no matter what type of sex work you do.

Set up a book-keeping system. Having no way to track how much money is coming in and going out will end up hurting you. You’ll have no way to know what you’re averaging and how much you’re spending. This can be as simple as a writing down everything you make in a notebook or as complex as a color-coded spreadsheet or financial software. A good, basic system is the date, the number of or type of appointment or job, and the amount made.

Figure out how to handle your cash. If you are working for a club, dungeon, or company that issues you a paycheck instead of you dealing with cash, skip this.

Decide what you want to do with your cash. Keep in mind that anything you deposit in a bank account, pay bills with, or buy large items with leaves a paper trail. If you want to keep your cash handy, one thing you should invest in is a good fire-proof safe. Keeping a lot of cash on hand is risky as a sex worker. If others find out, you can be at risk of robbery. A safe can help. Don’t hide cash in obvious places, like your mattress, the freezer, your toilet tank, and so on. If you’ve seen it in a movie, other people have, too. Consider having a dummy safe. This is a safe you hide in a more obvious place (under your bed, for example) and keep a small amount of cash in. Then, get a good, sturdy, floor-bolted safe or wall safe to keep more in. If a thief breaks in, the thief will quickly discover your dummy safe and leave your main safe alone.

Depositing cash is a good idea. Consider either a safety deposit box or a bank account. It’s a good idea to have three bank accounts: a personal checking, a savings, and a “business” checking. This can just be a personal account you filter all of your money through before it goes into your personal account. Keeping your money separate can demonstrate that you are organized in your business book-keeping.

Now that you have a budget and are handling your money, start some basic financial planning. What are your long term goals? Are you doing sex work to pay for something, pay off something? A really good rule of thumb is to have three months’ of expenses in savings. That way, if you want to take a break, you get fired, transition, the market turns around, you are hurt and can’t work, you’ll have a cushion. You’ll also have money in case of an emergency, like a car breaking down or a medical bill.

If you can afford it, consider basic health insurance, catastrophic only. If you are young and have no major health problems, you can usually get this cheaply. It will have a high deductable (sometimes $5,000 to $10,000), so it’s not for your annual exam or going into the doctor when you have a cold. It’s just in case you have a major event happen. If you get hit by a car or something equally terrible, the medical bills can wipe you out. Having insurance can protect you.

Once you have met your savings goal of three months’ expenses, start a savings plan for other things. If it’s for school, for a car or a house, or something else, think about your investments. This is my weakest area because, to be honest, having enough money to invest has never really happened to me before. But consider seeing a financial planner for this service, or someone like the Financial Madam. You can make low risk investments, like a savings account with interest, savings bonds, or certificates of deposit. You can also make higher risk investments, like stocks. Having a long-term retirement plan is an awesome idea.

In general, try to be smart with your money.  If something is a business investment (like a computer to check your email on, a car, or sometimes clothes), talk to your tax preparer about what is deductible. Otherwise, try to avoid the impulse to spend all of your money just because it’s there. I went through a period like that when I first started working. I had an awesome time and got some lovely shoes, but when I needed to get out like right now, I had absolutely nothing to fall back on.

On the issue of things to do with your money, consider reinvesting in your business. Again, some of these things are tax deductible. Setting up a business model is a good idea. Decide what your long-term goals with your type of sex work are. Use some of your income to place ads in the right places to tap your target market. Get professional photographs. Set up a website. Make little investments to set yourself up for long-term success.

When things get more complicated, there are many more issues to consider, like becoming incorporated or becoming an LLC. These are things I know nothing about at all, hence, talk to a financial planner, an attorney, and definitely your fellow sex workers. Being smart with your money is the best way to gain your independence.

janebrazen.wordpress. com/2009/07/08/finances-and-sex-work

Categories
IRS Sex workers taxes

Should People Who Sell Sex Report Their Earnings To The IRS?

Over Thanksgiving weekend, social media blew up over an internet subculture of women who trade pictures and videos of themselves performing lewd acts for money. Online activists took to social media to slow this shameful trade. It resulted in a viral hashtag, #ThotAudit, in which thousands of people reported these profiles to the Internal Revenue Service of suspected tax fraud.

Thot is internet slang for “that ho over there.” The word is meant to denigrate a female. In the context of the #ThotAudit, it’s being used to describe a subculture of online prostitutes of various types. Such women set up “premium” accounts, in which they deliver varying levels of pornography, often accompanied with promises of social interaction ranging from private messengers to monthly video calls via Skype, some charging up to $3,000 a month for their interactions.

As one woman stated on her Patreon account: “I will do some other miscellaneous worthless craft that takes no skill to make you feel like I care about you [sic].” While this may raise some red flags in a reader’s mind about its legality, the technical definition of what these women do is creating pornography, so it’s legal.

This internet sex subculture bothered a young bodybuilder by the name of David Wu. His first online mention of the problem came early Thanksgiving morning, when he reposted a question on his Facebook profile: “Why do sex workers demand respect when they don’t even respect themselves?”

He escalated the question later in the day by posting a poll asking “Is ‘sex work’ real work?” The poll was swarmed in comments, apparently by sex sellers and their followers. The overwhelming response inspired Wu to push further against the pervasive online porn culture.

These people who sell sex for money have online “tip jars,” but many don’t report their earnings. Wu made a post that has, as of this writing, been shared nearly 19,000 times. It took a screenshot of an Internet pornography seller who posed the question: “Who reported my premium Snapchat to the IRS? I’m being f***ing audited,” followed by a call to report more of the sex traffickers.

He posted a handy link to the IRS. This site not only gives the information on how to report but offers a form where an informant can collect a percentage of the unpaid taxes from the IRS as a bounty if their information turns out to be correct.

Once Wu’s post went viral, it spurred a storm of panic among pornographers. Hundreds of these profiles were reported over the weekend. One posted in response, turning it into a feminist talking point: “A bunch of men on Twitter are mad because they believe they’re entitled to free nudes, so they’re reporting sex workers’ Snapchat incomes to the IRS for audits… …Just say you hate women & leave.”

Australian reporter Frank Chung spun the concern for tax fraud into politics, stating, “Right-wing trolls report online sex workers to tax authorities in #ThotAudit,” also calling the people reporting on the potentially illegal behavior of sex workers “incels.” The incel charge has been repeated frequently in conjunction with the hashtag. The term refers to people who are not sexually active and will likely never be, despite wishing to be. It’s most used derogatorily toward men who are perceived as unable to obtain sex.

PJ Media’s Megan Fox responded by saying “Imagine having so low of an opinion of your writing that you have to increase sales by auctioning off nudes of yourself at 40.” Fox published an article titled “Fed-Up Gamers Report Intrusive Sex Workers to the IRS for Tax Evasion,” concluding, “As a mother of daughters, this campaign strikes me as morally good. If this can dissuade young girls from using their genitals to make money off men who are betraying their wives, I’m all for it.”

People who sell sex and sexual images, as well as some feminists, try to normalize porn and prostitution. However, it is important to note this weekend’s outrage was directed not at the morality of their actions, but whether they’re paying taxes.

The argument feminists have made on repeat is “Sex work is real work.” If this is the case, shouldn’t such workers be subject to the same tax laws as the rest of us? Provocateur and pick-up artist Roosh made several snide comments about the pushback, stating, “I’m finding it hard to believe that women are not reporting income that is direct deposited into a bank account linked to their social security number, but their anger at the #ThotAudit shows that’s exactly the case. It’s like they think laws don’t apply to them or something.”

There’s one positive aspect about those angered by the call to ensure these “jobs” are properly taxed: these young women are coming to understand the conservative and libertarian stances on taxation and how it affects normal people. Taxation does feel like the theft of money into the endless pit of government, and when you’re not used to having it taken from you, it can be a real eye-opener.

As such, it’s best to have sympathy on these poor women who are at risk of losing their incomes and let them know that if they really want to stop this online persecution by tax, they must vote for Republicans for Congress in 2020.

reposted with permission — Thanks Jon

Jon Del Arroz is an award winning author of the bestselling novel, For Steam And Country. He is currently writing several space opera and steampunk books, as well as a graphic novel set to come out later this year. He can be found at: http://delarroz.com. Twitter: @jondelarroz
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