How do I properly file taxes as a webcam model?

[CloudNine]

I received a 1099-MISC form from the webcam studios that I worked for and I want to know what form I should fill out to properly report my earnings and tax write-offs. I saved receipts from things that I had to purchase specifically for my webcam shows that I was told by a fellow webcam model could be written off on taxes. I want to make sure I am doing everything properly.

[VolvoGirl · Accepted solution]

Those are not employee expenses and not a schedule A deduction.

You are self employed for that and have to fill out a schedule C for business income.
You need to report all your income even if you don't get a 1099Misc. You use your own records.  You are considered self employed and have to fill out a schedule C for business income.  Enter it under…..
Federal Taxes Tab
Wages & Income
Choose Explore on my own or I'll choose what to work on  (if it comes up)
Then scroll way down to Business Items
Business Income and Expenses - Click the Start or Update button

You use your own name and ssn or business name and EIN if you have one.   You should say you use the Cash Accounting Method and all  income is at risk.  After you put in your income and expenses  if your net profit is $400 or more you will pay 15.3% for 2013  Self Employment tax in addition to your regular income tax.  The Schedule SE will be automatically filled out for it.

After it asks if you received any 1099Misc it will ask if you had any income not reported on a 1099Misc. You should be keeping your own records.  Just go through the interview and answer the questions.   Then you will enter your expenses.

Self Employment tax (Scheduled SE) is automatically generated if a person has $400 or more of net profit from self-employment.  You pay 15.3% for 2013 SE tax on 92.35% of your Net Profit greater than $400.  The 15.3% self employed SE Tax is to pay both the employer part and employee part of Social Security and Medicare.  So you get social security credit for it when you retire.  You do get to take off the 50% ER portion of the SE tax as an adjustment on line 27 of the 1040.  The SE tax is already included in your tax due or reduced your refund.  It is on the 1040 line 56.  The SE tax is in addition to your regular income tax on the net profit.

[CloudNine]

Yes, I am aware that I have to do Schedule C.. the very last paragraph is extremely confusing.

[ReeceS]

Hey CloudNine,

Unreimbursed employee expenses may include dues to professional societies, educator expenses, home office expenses, job search expenses in your present occupation, legal fees related to your job, licenses and regulatory fees, occupational taxes, passport for a business trip, tools and supplies used in your work, union dues and expenses and work-related education.

TurboTax will help you figure out if your expense qualifies for a deduction.

You will need to report your 1099-Misc under your Misc. Income. What sort of supplies are your trying to deduct?

Have a great day ;),

Reece

[CloudNine]

Thanks! This answers it!

[CloudNine]

I have receipts for things such as lingerie, shoes, lube, toys, stool and couch. I have read that I cannot deduct certain expenses and yet I have read that I can. I'm very confused.

[ReeceS]

Tools and supplies used in your work.
<a href="http://www.irs.gov/pub/irs-pdf/p529.pdf" rel="nofollow" target="_blank">http://www.irs.gov/pub/irs-pdf/p529.pdf</a>

[CloudNine]

Alright. This helps a lot. So I am able to deduct the full value of what I have spent on those items?

[Judd]

If what you bought is expected to and does have a useful life of more than one year it is depreciable and you would need to either depreciate it or elect to expense it all in this past year.  Given what I read in your questions, the only think that sounds like depreciable property, and since that is something that has other uses (unless it is really exotic) the amount of a deduction may not be worth the effort.  For more information you can refer to:

How To Depreciate Property <a href="http://www.irs.gov/pub/irs-pdf/p946.pdf" rel="nofollow" target="_blank">http://www.irs.gov/pub/irs-pdf/p946.pdf</a>

If you have any additional questions on this same topic please reply to this thread rather than starting a new one.  That way I will be notified of the new question and anybody else who looks at it will see the whole history of the thread.
Hope this helps. Thank you for choosing TurboTax!  Have a wonderful evening and a great day tomorrow.

Judd

[CloudNine]

Alright. So would it be advised that I shouldn't include the expenses?

[bobweissman]

We can offer opinions, which we generally refrain from calling "tax advice." My opinion is that as a self-employed person, you can deduct business supplies.

[cherryvonfairy]

So my question is, why write off pencils and post it notes (those are a one use sort of thing, or short amount of time, plus a small price, but they add up over the course of the year) why can A model not write off small expenses she has as well, like condoms to go over the toys for safety? I am confused as to why the erotic factor would mean anything. These items are purchased and used for business.

[Judd]

There is no reason at all not to deduct them, so long as they are reasonably necessary and the enterprise is legal, and I although I lack knowledge of the specifics of this one, I have every reason to believe it is legal.

[cherryvonfairy]

Thank you for your quick answer, as the previous model has said many sources say yes and no to writing off those things. However your answer does seem to clear up all my confusion. Thanks! Have a wonderful day.

[Judd]

Just make sure you can document the expenditures and be able to show how and why you use the items - on the job.  This can be a problem in all jobs where there is the opportunity to get personal and business use mixed together, as there is in yours.  Also, if you are buying something that is used both personally and for the job, you need to be able to show how you allocated the expenses.  If you are dealing with specialized clothing, even though what you buy may be selected for the job, as long as you could wear it in personal life you cannot deduct any of it.  (Example, a person who buys a business suit for an aspect of the job and who would never wear it in private life cannot take a deduction because (s)he could wear it, if (s)he chose, other than on the job.)