Let me start off by saying that I am not with the IRS, I am a fellow hobbiest like you and enjoy the company of many of the fine providers in LA.
My question is that providers are all paid under the table, how do they get around paying taxes or not get audited every year?
Probably none of my business but I was just curious and have never been able to broach the subject with the providers that I have seen. Any idea?
I claim myself as an entertainer and take itemized deductions. I have an accountant that knows what I do prepare my taxes...he is very conservative and has me pay over what I owe in taxes to stay on the good side of things.
Because of this, I am able to invest and be in charge of my own financial freedom. I can put money in the bank or invest and not have to worry about explaining how I got the $$. I never have to worry about putting things *I* worked for in someone elses name. I can sleep at night, not worrying that a lifestyle audit would put me living above my means. And like it or not, I am doing my part to keep the country running.
(side rant)
My biggest pet peeve is women that make fat cash under the table in this business that get government assistance like food stamps and healthcare because they don't show any income. If you want to use the system, you have to help support it!
(end side rant)
xoMegan
They pay their taxes just like any other individual in a cash business. If you don't know what that means call your accountant. Providers that last in this business are smart businesspeople. They certaintly know that facing a tax evasion charge from the IRS is as bad as it gets.
It's only "under the table" if a lady does not report the income... and who is crazy enough to play games with the IRS?!? I suppose there are some out there, the smart ladies I know have business licenses and pay the tax.
You can list the income on your taxes and instead of putting where the income came from you can put 5th as in I plead the 5th. Putting something that might be considered aginst the law would be incriminating your self which the 5th amendent protects you from.
Unforunately it appears many if not most of the providers don't plan ahead. they may have goals, like buying a house and such.
The money comes in easy, and it goes out easy. Clothes, drugs, surgery, men, whatever. Even if they are good enough managers to save the cash, there isn't much they can do with it. Try and buy a house or condo with cash! LOL
Yes the smart ones set up consulting firms and pay their taxes.
TMT
The IRS doesn't give a crap where you get your money...so long as you report it all. Most ladies that I've talked to about this report their income, make business deductions and pay taxes just like us normal schmoes. One thing they don't f**k around with is the IRS.
I file the 1099 form for independent contractors. Or rather, my tax guy does and I sign my name to whatever he puts in front of me.
Whatever the girls do regarding taxes is their business. I am sure most of the ones who pay taxes use a fictitious business or profession to report their income. This is a public forum open to anyone who has access to a computer. Displaying information regarding how they pay taxes on an illegal enterprise can only be harmful to them. Why give the hunters more ammunition to destroy their legal prey? “Loose lips sink ships.”
There is no need to use a ficticious business to report income. You just claim a business run in your name; no need for a DBA certificate or license, nor is it ficticious. Further, the occupation isn't a matter of record; you could just claim to be a consultant, or a private contractor, or even (and this is a legitimate business AND legal) a masseuse/massage therapist. You are just self employed.
The IRS really doesn't care WHAT you do to get your money. That's not on the tax forms anywhere. What they care about is that you pay your taxes.
You will get in a whole lot more trouble by not paying taxes than by filing and paying taxes. Remember, Al Capone was ruthless, had people killed left and right and was hated/feared in Chicago. What took him down: failure to pay income taxes.
My experience is that many (not all) people who deal with cash under report or hide some of there income. As long as they live a life style that is reasonable compatible with the reported income they will draw little attention from the IRS. I have a good friend in Vegas that has a small mortgage company that lends money (secure by a deed of trust) mainly to Dealers, Cocktail Waitresses, Stripper, and probably Providers who can not qualify for home loan from a bank because they under report there income (tips and fees) the last two years to the IRS. His company has made a fortune by charging them higher than market interest rates and loaning them no more than 50% of the property value.
Why in the world would you even ask this question? No lady is going to make a post on this board saying anything other than she pays all of her taxes. The truth probably is some report all of their income, some report part of their income and some report none of their income. The last sentence applies to the country in general.