[QUOTE=Aegean45;6019812]Curious, can't a provider just start a cleaning business or even an entertainer business and legitimize their earnings that way? My guess is that they don't want to pay taxes on their earnings but don't realize the hidden costs of doing business in cash only like you mentioned.
It's not that hard to start a LLC or sole proprietor, get a business checking account, state UBI number, give themselves a salary and W-2, write off "business" expenses.[/QUOTE]I'm an accountant / business consultant / tax specialist that owns an acccounting firm. I currently have about 20 escorts / strippers / sex workers that I work with, but have probably had about 100 at various times since I've been in business (just so you know, I have NEVER taken a trade, they all pay the same as my other clients). Here is the truth:
Smart sex workers are not hurt as much as you think. A (fake) tax return and proof that they regularly put money in the bank will get them a car loan and approval for a rental. Smart use of credit will get them credit cards.
A real tax return, will get them approved for a mortgage (if they earn enough and pay the tax owed).
The IRS gives zero fucks that they are escorts. They just want them to report their income and pay tax on it. There is a law that says that if you have income in an illegal business, that you can't write off the expenses you incurred, as a sex worker, there are a million ways to work around that as there are many types of sex work that is legal. You're willing to break a bunch of laws regarding your trade but afraid to tell a white lie to the IRS?
Money given to Sugar Babies are "gifts" and not reportable income (by the sugar baby), the Daddy needs to report any excess over the gift tax limit. I suggest that SBs report that money in some form (and pay tax on it) if they want to purchase real estate.
All that being said, if a sex worker is making good income and struggling because they have to pay cash for stuff, it's their own damn fault. What I've found is that sex workers (like most of us) simply are unwilling to pay the actual taxes on the income they receive, so they tend to hide it because it's easy for them to do. I think the illegal nature of the business plays a large part in them not going legit. They are already doing something that is illegal, why should they follow some laws and not others? For many, they have never contemplated owning a home, having a retirement or have investments like everyone else and don't realize that they can do all that being sex workers. Unlike many businesses, sex workers are unlikely to seek out professional help because of the nature of the business. My first sex worker client actually came to me because she thought I was a woman owned business and thought she could discuss her issues with a woman. She was uncomfortable discussing what she wanted because she thought I was either going to judge her or try and hit on her. I flat out told her that I see escorts and I don't have an issue with what she does, then gave her my rates and told her I expect prompt payment. I'm the first person she calls she has financial issues and she referred all of her friends to me.
