Taxpayers who don't earn regular salaries often have difficulty keeping track of their tax liabilities throughout the year. If you're an exotic dancer, you probably handle relatively large sums of cash on a daily basis. For a variety of reasons, it's unlikely that you've kept careful track of these receipts.
In the vast majority of cases, legal exotic dancers are treated as "1099 contractors" for tax purposes. In order to evade liability issues and make it easier to terminate unproductive arrangements, nightclub owners rarely establish official employer-employee relationships with dancers. This also frees them from the obligation to provide employee benefits or surrender payroll taxes to their state and federal governments.
As an exotic dancer, you're technically in business for yourself. Although you're probably not incorporated as a sole proprietorship or LLC, you have the right to claim certain payouts as "business expenses ." If you work at a regular nightclub or dance bar, much of the income that you "earn" over the course of the year is likely to be cycled back into the establishment. At various points during the year, you might compensate the bouncers who provide you with steady streams of clients or tip out the establishment's bartenders and waitstaff. Since these expenses are
a necessary part of doing business as an exotic-dancing "independent contractor ," they can be claimed as business expenses.
Many exotic dancers choose not to pay taxes at all. This is understandable: The complexity of the typical exotic dancer's tax situation can be overwhelming. However, the IRS often conducts audits on individuals with unclear sources of income. Even if you live frugally and don't draw on state or federal government services, it's unlikely that you'll be able to evade your tax liabilities for more than three or four consecutive years.
Other exotic dancers choose not to pay their taxes due to embarrassment. This is understandable as well. Unfortunately, it's usually not possible to conceal your occupation from the IRS. Doing so could actually increase your chances of being audited.
If you continue to work as an exotic dancer, begin keeping close tabs on your income and expenses. After each day that you work, write down the value of your earnings and payouts. At the end of every quarter, you'll need to transfer a specific sum of money to the IRS to cover the "quarterly estimated taxes" that all contractors and independent business owners must pay. You can learn more about this process on the IRS's website.