Taxes, Banking, and Other Nightmares of Being a Sex Worker

Posted by Julia | 8 min read

Nobody warns you that being a sex worker means becoming an expert in financial crime prevention, tax law, and creative banking solutions.

Let me start with the banking nightmare, because it's ongoing and ridiculous.

I've had three different bank accounts closed without explanation over the past two years. Each time, I get a generic letter saying they're "discontinuing our banking relationship" with no specific reason given.

But the pattern is obvious - they figure out what I do for work (probably from deposit patterns or transaction descriptions) and decide I'm too much of a risk or reputational liability.

The first time it happened, I was completely unprepared. I had rent due in three days and no way to access my money while waiting for a new account to be approved somewhere else.

Now I keep accounts at multiple banks and credit unions, never keep all my money in one place, and constantly worry about which account might get closed next.

Opening new accounts has become an art form. I've learned to describe my work as "independent consulting" or "personal services," which is technically true but vague enough not to trigger automatic red flags.

Credit cards are even worse. I've been denied for cards I should easily qualify for based on my income, because something about my financial profile looks suspicious to their algorithms.

Then there's the cash problem.

This industry still operates largely on cash, which creates all kinds of complications with banks that are increasingly suspicious of cash transactions.

Large cash deposits trigger reporting requirements and suspicious activity reports. Too many cash transactions can get your account flagged. But not depositing cash and keeping everything in your apartment isn't exactly a safe option either.

I've had to learn the rules about structuring (don't deposit $9,999 thinking you're avoiding the $10,000 reporting threshold - that's actually more suspicious), money laundering (apparently paying your rent with cash can look like laundering), and all kinds of financial regulations I never knew existed.

The tax situation is its own special nightmare.

First challenge: what do you call your business on tax forms? "Escort services" might be technically accurate but could invite unwanted attention. "Personal consulting" is vague but might not justify business expenses.

Second challenge: what expenses can you legitimately deduct? Hotel rooms are clearly business expenses, but what about lingerie? Makeup? Gym memberships to stay in shape? The line between business and personal expenses gets blurry fast.

Third challenge: estimated quarterly payments when your income is completely unpredictable. The IRS wants you to estimate your annual income and pay taxes on it quarterly, but how do you estimate something that varies by 300% month to month?

I finally found a tax preparer who works with other people in similar situations, and she's been a lifesaver. But finding someone who understands the unique tax challenges of sex work without being judgmental took forever.

The paperwork is insane too. I track every expense, keep receipts for everything, maintain detailed records of New York escort service business costs versus personal expenses.

I have spreadsheets for hotel costs, lingerie purchases, advertising expenses, health testing, transportation, makeup, hair, everything. My record-keeping is probably more thorough than most legitimate businesses.

And despite all this careful documentation, I always worry that an IRS audit would be a nightmare to explain.

The whole financial system seems designed assuming you have a traditional job with W-2s and predictable income. When you're self-employed in a stigmatized industry with irregular cash income, everything becomes ten times more complicated.

I spend probably five hours a week just managing the financial and administrative side of this work. Banking, taxes, record-keeping, expense tracking - it's like having a part-time job on top of your actual job.

Sometimes I think the financial complications are almost as stressful as the work itself.