Taxing Sugar Babies

By BRIDGET J. CRAWFORD. Full Text.

How people talk about tax reflects both personal beliefs and larger cultural attitudes. In many cases, whether and how a potential taxpayer understands their activities in tax terms may also reveal attitudes about themselves and the value that society assigns to those activities. This Article examines how sugar daddies and sugar babies talk about taxes in two Internet discussion forums to reveal the ongoing stigma associated with sex work. Through mostly content analysis, the focus is on the attitudes of sugar daddies and sugar babies toward taxation and the filing positions they take, as well as how tax professionals intervene in online discourse at the intersection of tax laws and sugaring.

This Article makes three principal claims—one descriptive, one normative, and one interpretative. First, the dominant discourse among sugar daddies and sugar babies is that a sugar baby receives “gifts,” not income in exchange for companionship that usually (but not always) includes a sexual element. A discernible counternarrative emerges from apparent tax professionals who take the view that a sugar baby’s receipts are income. Second, this Article explains that this latter position is likely true as a technical tax matter. However, it is unlikely that tax authorities will seek to prosecute sugar babies for failing to report income. Sugaring occupies a gray area between private, intimate relationships, on the one hand, and commercial sex work, on the other. Third, the persistence of tax talk that a sugar baby’s receipts are gifts helps maintain this gray area, even though the non-taxation of a sugar baby’s receipts hurts both the government, in the form of lost tax revenue, and sugar babies themselves, who do not receive work credit toward Social Security and other programs that depend on years of market labor. The persistence of the gift rhetoric further devalues the sugar baby’s efforts, ignores the emotional and physical risks associated with sugaring, and perpetuates longstanding stigmas against sex work.