This might help:
9f. Special guidelines for erotic literature:
Smashwords has always allowed a wide range of erotic literature and has been a strong industry advocate to protect the ability of authors and publishers to publish legal erotica, and for readers to enjoy it. Like all publishers at Smashwords, erotic literature authors and publishers are held to all the requirements listed above and below in the Smashwords Terms of Service. For the benefit of our erotica authors and publishers, we've created this special breakout section in the ToS to provide additional guidance unique to erotic literature. We understand that there are many gray areas when it comes to erotic content, so any attempt to define black and white policy is fraught with risk that our policies might be unevenly or inconsistently applied. In the spirit of providing the greatest possible transparency, we define what we can define. These extra guidelines below are intended to help authors and publishers maximize the distribution of their erotic content; help avoid crossing lines that would be detrimental to their publishing and/or detrimental to their fellow community of professional erotic writers; and avoid publishing content that would be detrimental to their relationship with retailers, library partners and Smashwords. These guidelines are subject to change.
As you'll see below, a few taboo categories have been identified as allowed at this time but not encouraged. These categories should be considered "under watch" and subject to additional review scrutiny or removal, and subject to future policy changes due to legal or business considerations, or subject to policy change if too many of the publishers in these discouraged categories push the limits of acceptability, or subject to individual title or publisher removal if an individual publisher publishes high volumes of this discouraged content or pushes other limits of acceptability. If you believe your titles were removed in error, please contact the Smashwords Support team by clicking the "Support" link below and request a reevaluation. These guidelines will be enforced at the sole discretion of Smashwords. Thank you for your understanding as we work to preserve the greatest level of publishing freedom for our professional erotic writers and publishers.
• Neither the book cover nor the book interior of erotic content may contain graphic images of nudity (either photographic or illustrated) or persons involved in sex acts
• Erotica authors and publishers must categorize their books under fiction: erotica when uploading to Smashwords and must maintain these categories. If an author or publisher miscategorizes erotic content under non-erotic categories, they risk either removal of the work or account termination, at the discretion of Smashwords.
• Authors who publish erotica and romance categorized under "fiction: romance: erotic" are required to provide supplemental categorization information related to certain taboo themes. Authors and publishers who fail to provide this information, or who deliberately miscategorize their works in an effort to subvert the collection of this information, may face book removal and/or account termination at the sole discretion of Smashwords or its retailers.
• Smashwords recommends that book descriptions and titles for erotic literature should be kept "PG-13." Excessive profanity in book descriptions may lead to further scrutiny and review, or blocked distribution or removal from Smashwords.
• Smashwords has a zero-tolerance policy for underage erotica (characters under age 18), and this policy has been in effect since the beginning of Smashwords in 2008. Underage erotica is strictly forbidden, and the upload of such will lead to immediate account termination. In erotic literature, children or underage minors cannot be engaged in sexual acts or situations, bear witness to such situations, be shown considering sexual acts, or be shown thinking about sexual acts.
• Erotica models for cover art must be adults. Underage models, or models Smashwords believes are likely to be construed as underage, are not allowed to appear on erotica cover images.
• "Barely legal" erotica is strongly discouraged, and is subject to additional review and may be removed without notice at the sole determination of Smashwords, especially if characters are in situations - or have mannerisms - that suggest that the characters are actually underage.
• Rape erotica and sexual slavery erotica, where the predominant theme is rape violence for titillation, is strongly discouraged, and is subject to additional review and may be removed at the sole determination of Smashwords. Note that erotic BDSM fiction that adheres to BDSM best practices, where all role-playing is consensual with safe words, is allowed and not to be confused with rape or sexual slavery erotica.
• Scat, snuff and necrophilia erotica is prohibited
• Bestiality erotica is allowed but not encouraged. A one-off title is more likely to be acceptable than if a publisher is publishing dozens or hundreds of such titles. At Smashwords discretion, such content may be removed or accounts closed.
• Incest and pseudo-incest (sexual relations among non-biologically related relatives and siblings) erotica is allowed, but it will be blocked by most retailers and library aggregators.
