Questions? Answers

general

  • Not sure where to begin? Book a one-off consultation call with Katherine — no application needed. Calls are available from $20–$165 depending on what you need.

    Ready to become a client?

    1. Submit a client application. This helps us understand your situation and confirm we’re a good fit.

    2. Get approved. Once approved, you’ll receive an RSVP link to book your onboarding with a $200 credit toward any service.

    3. Choose your service.

    • One-time tax prep starts at $750 and includes a complimentary call with Katherine.

    • Monthly subscription bundles bookkeeping, tax prep, and more — and includes a call with Katherine.

    4. Pay upfront, then we get to work. Payment is required before any work begins.

    Ready to apply? Fill out our client application to begin the process.

  • We won’t lie, spicy tax deductions are way more fun but of course we can help anyone looking for a non-traditional tax experience.

    This includes:

    • Realtors

    • Hair Stylists

    • Freelancers

    • Creative Entrepreneurs

    • Beauty Professionals

    • Small Businesses

    • W-2

    • American Expats and Digital Nomads

    • Travel Nurses 

  • The Only Consultant® and Prisma Tax Group are remote-first, so we can help you no matter where you are in the USA. All consultations are done over the phone (not via video call—between content creation and the number of calls I take, Zoom just isn’t feasible <3). Occasionally, I do a city tour and offer in-person consults. Be sure to follow me on Instagram for updates and see when I’ll be in your area!

income & expenses

  • Track all cash payments, including the date, amount, and purpose. Use a spreadsheet, accounting software or even a journal. All income—including cash—must be reported to the IRS. To help with this, you can download our free expense trackers available here!

  • Yes! Every dollar you earn is taxable.

  • The IRS defines a business expense as something "ordinary and necessary" for earning your self-employment income. In other words, it takes money to make money! Since running a business involves costs, the IRS lets you "write off" business expenses to reduce your taxable income. Just keep in mind, these expenses must comply with IRS guidelines (so, no personal or extravagant spending). If not, you could face penalties and interest in the event of an audit—definitely not worth it! You can learn more here: IRS Pub 535.

  • There’s no one-size-fits-all method for tracking your business expenses—just pick a system that works for you and that you can stick with. You can use notes on your phone, a spreadsheet, paper records, or a program like QuickBooks. I’ve even created custom spreadsheets specifically for OnlyFans creators and strippers, and you can grab them HERE!

  • No! You can still deduct your business expenses as a sole proprietor (which is the default for anyone who receives a 1099-NEC).

    However, if you’re interested in the other benefits of an LLC—like separating your personal liability from your business—then setting one up might be worth considering. You can get started on that anytime!

  • Here are some of the most common business expenses for adult content creators. This is not an all inclusive list but a starting point.<3 

    • Percentage of rent and phone bill 

    • Percentage of wifi 

    • Makeup only used in content creation 

    • Camera, computers, ringlights and electronics 

    • Management fees 

    • LLC formation 

    • Health insurance premiums  

    • Video editing software 

    • Tax Preparation 

    **and many more, please note this is niche specific and you should meet with a tax professional to ensure you’re following IRS compliance 

  • Here are some of the most common business expenses for adult content creators. This is not an all inclusive list but a starting point. 

    • Tip outs 

    • House Fees 

    • Pleasers and Dancewear 

    • Pole Classes 

    • Health insurance premiums 

    • Entertainment Licenses 

    • Travel dancing  

    • Tax preparation  

  • Under the IRS passive activity loss rules, income is classified into three main categories:

    • Active income includes wages, commissions, bonuses, profits from a business in which the taxpayer materially participates, gains from the sale of assets used in an active trade or business, and income from intangible property if the taxpayer’s personal efforts significantly contributed to its creation.

    • Portfolio income covers most interest, dividends, annuities, and royalties, as well as gains from selling property that generates this type of income.

    • Passive income comes from trade or business activities in which the taxpayer does not materially participate, such as limited partnerships or S corps, and includes all rental activities, even when the taxpayer materially participates (with some exceptions for real estate professionals).

tax

  • If you’re a sole proprietor or a single-member LLC, your business income is included on your personal income tax return, so there’s no need for a separate filing. However, if you’re part of a partnership LLC or a corporation, you’ll need to file a separate business tax return.

  • Take a big breath! This is more common than you think. So many people are behind on their taxes, don’t be hard on yourself. If you’re behind we need to start with the first un-filed year. If you’re not sure the last year you filed you can log into your IRS account at IRS.gov/account.

    Contact us for help getting back on track.

  • Item deIt depends on the state! Income is taxable in the state it is earned, so if you earned income in a state where there is income tax you'll need to file. Some states has no income tax. (Florida, Nevada, Texas, Tennessee, New Hampshire, Alaska, South Dakota, Washington & Wyoming)scription

  • Yes! You will receive a 1099-NEC from Fenix and will need to file this on your tax return. You will also need to track your business expenses and will be taxed on the profit.

  • No, you need to file your tax return with your government name and social security number

No tax On tips

  • It's a new tax deduction that lets certain workers subtract up to $25,000 in tips from their taxable income. Less taxable income = a lower tax bill. It was signed into law on July 4, 2025 and covers tax years 2025 through 2028.

    "No tax on tips" doesn't mean tips are magically untaxed. You still report them and have to pay state and self employment tax, just no federal tax.

  • You have to work in one of the occupations the IRS officially approved , over 70 of them across industries like food service, entertainment, hospitality, delivery, and personal care. And your income has to be under $150,000 if you're single, or $300,000 if you're married filing jointly. Above those numbers, the deduction starts to phase out. Dancers DO qualify, adult content creators do NOT.

  • Yes dancers are explicitly on the IRS list. If you're working at a club or performing at events and customers are voluntarily tipping you, those tips may qualify for the deduction.

    Your specific situation matters, how you're classified (W-2 vs. 1099), your income level, and the nature of your work all factor in. There is not blanket quick answer for every dancer automatically due to how the industry works, but the door is open and we understand the nuances. Set up a call to discuss. 

  • No. The law specifically excludes tips connected to "pornographic activity." This was written into the original legislation and confirmed in the IRS final regulations in April 2026. If adult content is your business, your tips from that work don't qualify, regardless of how the payment is structured.

    The IRS hasn't defined exactly what "pornographic activity" means, which creates gray area. But if your content is explicitly adult in nature, don't assume you're eligible. The risk isn't worth it.

  • December 31, 2028, unless Congress extends it.

    This is for informational purposes only, not legal or tax advice. Tax laws change. Work with a qualified tax pro for your specific situation.

Business Entities

  • The short answer is no. An LLC draws a line between your business and personal assets in case you’re ever sued or go bankrupt. There are no tax savings just from forming an LLC. But if you’re making money, entering into contracts, care about privacy, want to build business credit, or could potentially benefit from an S Corp election, you should consider forming an LLC.

  • The moment you start earning self-employment income, you’re considered a sole proprietor, a term often used interchangeably with freelancer or independent contractor. An LLC creates a legal boundary so that if something goes wrong in your business, your personal finances aren’t at risk.

    You can still deduct business expenses against your self-employment income with or without an LLC.

  • Not automatically!

    If you’re making a consistent profit, you can elect S Corp status, and that’s where the tax savings come into play.

  • This is a common misconception. The short answer is no, not unless you’re running a tech startup or have a specific legal strategy.

    For almost all small business owners, it’s best to form your LLC in the state where you live, to avoid double paperwork and unnecessary complications.

    Income is taxable in the state where it’s earned, not the state where the LLC was formed.

  • Yes, absolutely.

    Open a business bank account linked to your EIN, not your SSN. This keeps your bookkeeping clean and helps protect your LLC’s legal status by separating personal and business finances.

  • Sometimes!  An S Corp is an extremely effective tax strategy for the right people. You need an LLC or Corporation first and then you elect to have it taxed as an S Corporation and save on self employment tax. It makes sense if you’re consistently profiting $60k a year and can commit to the compliance of filing an additional tax return, running payroll to yourself and keeping tight bookkeeping. It can save tens of thousands! Set up an S Corp consultation call if you have more questions.