: Must every piece of speech get its own paragraph? I've had a few people read pieces of narrative writing I've done, and they seem to take issue with the fact that I sometimes put a piece

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The trick is to not think of dialog as script, but action... in this case speech... so if your paragraph contains dialog, it is either the subject action of the paragraph, or part of the subject action. So lets parse out what is happening here by marking the individual actions taking place:

Action: As Jill walked home, the mints jiggled happily in the box in her pocket, as if they were waiting to be eaten. Suddenly, the box snapped open and one mint fell out.

Action: "Dammit," said Jill, bending down to pick it up. As she picked it up, eyeing it, she noticed that the mint didn't have any dirt on it at all, despite falling onto the dirty, wet sidewalk.

Action: "I guess you're spoiled anyway, so I can't bring you to Fran," muttered Jill, so she popped it in her mouth. Suddenly, she felt changes occurring in her.

You'll notice at each break, there is a new verb happening... Jill Walked, Jill said, Jill muttered. Even though Jill is the only person in the entire paragraph, she's not doing all this at once, there is a causality to each and a response. As a rule, dialog should either be at the very begining or very end of a paragraph, never in the middle. "Dammit" could be be at the tail of Action 1, or lead Action 2 (in the former case, you can drop the Jill said, since we know Jill's action and reaction is the topic of that paragraph). Similarly, the dialog in the third action could end the second action, leaving the third action to her eating the mint and then feeling the changes... It's fine for the opening of the third paragraph, but my mind is drawn to the the " so she popped it in her mouth" part, which... needs work... I can't tell you why it's not right, but it reads horribly... either make it action she says as she eats the mint or break it off into another sentence or better yet, another paragraph (or fix it as something she does while muttering and make suddenly feeling changes and the description of said changes a fourth action.

Yes, in this scene, Jill is talking to herself... just because only one person is involved, it doesn't mean she's not having a conversation. Assume Jill's mind is talking back to her and we're just not able to hear it... though it can be contained in a single paragaph if Dammit is the first sentence and "I guess you're spoiled..." is the last sentence... as submitted, there's too much going on for this to be a single paragraph.

The trap this falls into is that a paragraph must be a certain length... in a story... especially when describing action at a normal pace (you're not moving fast, you're walking) needs to contain enough to describe one big action and all immediate reactions to it. Hope this helps.

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Statements from many different characters each receive their own paragraph and an single individual will have their own single paragraph. However, if this is a story only to be seen by you then do what makes most sense or easiest to read for you, for the best personal entertainment from your writing.

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Jill found a box of mints she liked, and took them off the shelf. She
walked up to the cashier. "How much are these mints?" she asked,
holding up the box.

"Two fifty," replied the cashier. Jill handed him the money, took the
mints, and left the store.

Your first paragraph, yes, your second, no. Some persons are saying that it's somehow confusing to separate the dialogue from the actions of another person, but that indicates, to me, a fundamental lack of cognizance of how the English language is used. A new speaker is always on his own paragraph, and then if someone else does actions thereafter, there is a new paragraph. There is no "pause" because this is just how the language is used.

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As others have said, the convention is that each new speaker gets a new paragraph. Breaks in the statements of one person do not require a new paragraph. We generally do not break the speech of a single individual across multiple paragraphs unless the speech is relatively long.

Some of the comments on this question have indicated that you should disregard conventions and do whatever you like. If taken literally, I must disagree with this. While I would be the last to advocate slavish adherance to conventions, conventions exist for a reason: They allow us to convey information to the reader more economically. To take a silly example, suppose you said that you don't like putting quote marks around quotes, so you're going to use plus signs instead. Now the reader has to figure out that in your writing, plus signs indicate a quote. You make the reader do extra work, to shift mental gears, and for what? If, in your particular book or article, this serves some definite purpose -- hard to imagine in this example, but maybe you could some up with something -- then maybe it's justified. But don't break the rules just because you feel like it. I only break the rules when, (a) I want something to stand out, or (b) when the rule is so illogical in general or inapplicable in the present case that the advantages of breaking the rule outweigh the extra burden on the reader.

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The fact that you had people complain suggest that there is something wrong. Of course, it greatly depends who is doing the complaining, since some people will complain about all sorts of nonsense, but reading your example, I too have a complaint. My complaint is not that you have inline speech (I actually like inline speech, it makes the dialogue less dry, I see nothing wrong with that) it's that you have one character speaking while a different one is performing an action in the same paragraph.

"Two fifty," replied the cashier. Jill handed him the money, took the mints, and left the store.

The cashier is speaking here, but it's Jill that's doing the action. This isn't a very complex action so as to confuse anyone, but writing this way increases the chance that there might come an action complex enough that would make it hard to differentiate who is actually speaking. It's much more cleaner, so to say, if it's separated:

"Two fifty," replied the cashier.

Jill handed him the money, took the mints, and left the store.

Some even go as far as to separate any action made by different characters into their own paragraphs. For example:

Jill handed him the money. He took it, deposited it into the register and returned ten cents worth of change.

There is no dialogue here, but remember, dialogue is just another type of action. It will always be much clearer if each character gets his own paragraph. If this was Jim and not Jill handing him the money, could you be absolutely certain who is returning the change, Jim or the cashier? When you put a paragraph break there, that's a queue to the reader that a different character is performing the action now, so there's less chance for confusion.

Jim handed him the money.

He took it, deposited it into the register and returned ten cents worth of change.

Like others had said before, there are different styles used by different publishers, which change and evolve not only with time but place as well - different countries have different customs. And these are only customs, things readers are accustomed to from books they've already read. For example, in some countries you'll find dialogue separated by dashes instead of quotes, and while it won't confuse the readers from those countries because that's what they're used to, it will confuse readers from other countries. The one single rule we can all agree on is not to confuse the reader. Your best bet for not breaking that rule is to stick with what the reader is used to.

Also, don't ask yourself what are the rules of style, ask yourself how can you make things more clear to the reader. I think everyone can agree that separating different characters actions (be it dialogue or not) into their own paragraphs can only make it more clear, not more confusing. In other words, I see more benefits in separating it than leaving it in the same paragraph. Actually, I see no benefits at all in leaving it in the same paragraph.

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Now, while others mentioned correctly, one paragraph per speaker, I do have a problem with your other example.

As Jill walked home, the mints jiggled happily in the box in her pocket, as if they were waiting to be eaten.(1) Suddenly, the box snapped opened and one mint fell out. (2)"Dammit," said Jill, bending down to pick it up. (3)As she picked it up, eying it, she noticed that the mint didn't have any dirt on it at all, despite falling onto the dirty, wet sidewalk. (4)"I guess you're spoiled anyway, so I can't bring you to Fran," muttered Jill, so she popped it in her mouth.(5)
Suddenly, she felt changes occurring in her.

This is about paragraph breaks between segments of a story. It's hard to put this rule in words. Essentially, every turn of action should get a new paragraph. What is a turn of action? Now this is a very fuzzy expression and it's mostly up to the author, although in certain cases it's indisputable - like (5), where I put the paragraph break where it absolutely belongs. We are no longer on our standard run-off-the-mill walk. Changes occur. New paragraph is a must.
Now, where to introduce new paragraphs, other than change of speaker in a dialogue?

A rapid, unexpected change of state. Note, a very brief introduction of prior state is still allowed, like I'm not separating the first sentence - one might put paragraph break at (1), this is at writer's discretion, but the single, short sentence would be a poor paragraph on its own. Longer introductions of prior state definitely should be separate paragraphs.
A minor change of state, if the paragraph has been going on long enough. (3) would be permissible but that would make for some very short paragraphs, not really encouraged.
Longer pauses in action. If a character stops to gaze at the sky for a minute, you're fully justified to resume the action once the minute is past starting a new paragraph.
Changes of scene. The moment Jill arrives home, enters and greets Fran, this should be a new paragraph. (the action of unlocking the door and entering may be within the allowance of introductory sentence).
A new thought, a new subject. The rule "one paragraph per speaker" should be violated if a person speaks at length. They arrive at an intermediate conclusion, a point necessary to continue with the following train of thought, then they continue with a new paragraph. (I always had a problem: what to do with quote marks around these...)
Internal dialogue. A character asks self a question. You are fully allowed to answer in a new paragraph, although this is not a necessity. (2)(4)
Introducing severe transitions of state can be paragraphs on their on. Note how the sentence after (5) can be the first of a new paragraph, or (better!) be a very short paragraph on its own, before you start describing the transformation in another one. Such tiny, short paragraphs are like exclamation marks, a sign that something big is about to happen.

Note, none of these are written in stone. But just as breaking the introductory sentence (1) would make it less interesting, not breaking off the turn of events (5) blurs the importance of the event.
Think of paragraph breaks as giving the reader a second of pause to take the content in, absorb the meaning and place it in greater image of the story. It's a bite-sized portion of information. Sentences are for clarity while reading and sections/chapters are for continuity separation, but paragraphs are the most important units of information, absorbable by the reader as a whole.

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I am in the middle of editing a book where I'm adding this technique, so I endorse it whole-heartedly. :) My two rules are:

Don't confuse the reader. Make sure that no matter what, it's clear
who is speaking. This applies to narration, dialogue tags, action tags, and lack thereof of all of them.
A new speaker gets a new paragraph, regardless of where the dialogue
starts in the paragraph.

Your examples follow both these rules, and I quite like them. There's no reason to start Jill's dialogue on its own line in the middle of a narrative paragraph when it's perfectly clear she's the only one speaking. And since she continues to speak without anyone else interrupting her, the second line of dialogue still doesn't need a new paragraph.

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