With every season, comes an assessment of which hairstyles are trending — especially during the spring when everyone is looking to get a fresh look. And spring also is that inevitable tax time. The IRS considers a independent stylist – who purchases their own styling tools, and works according to their own schedule – a self-employed independent contractor.
For that reason, it’s your responsibility to report all income and pay your own federal and state withholdings. It’s also important to know what you can write off when filing your taxes. It could make a significant difference in the amount you owe.
Take a look at some of the business-related expenses that you can write off when filing your taxes.
Equipment and products. Anything that you need to run your business can be considered for a tax write-off. Look around your booth. That means that you can deduct expenses for your blow dryers, shampoo, conditioner, scissors, chemicals and any other tools or products. It also can include your clothing if you maintain a uniform that’s used for work only.
Promotional and other business expenses: You can write off any money spent on products you used for promoting your business. These include web-hosting costs, business cards and advertisements. Fees for preparing your taxes for filing, software for keeping appointments or used to help run your business more smoothly can be written off.
Licensing and training. As a stylist, you need to be licensed in your state. It’s the law. That means it’s essential to your operations, and you can write off the licensing fee. Also, if you undergo training to maintain your license or keep up with your industry, those expenses are tax deductible as well.
Insurance: All independent stylists should have a liability insurance policy. This can be a tax write off for you. When using your car — for business purposes only — you may be able to write off part of the price of your car insurance, as well as mileage and gas.
Entertainment and travel: If you are attempting to impress or gain a new client by taking them out, it is commonly acceptable to deduct half of the cost for dinner or any other meal, and half of the costs for entertaining, such as taking them to a sporting event. If you have to pay for a cab to go to a hair show, that is another write off.
A photo posted by Stylie (@gostylie) on
Preparing and filing your taxes as a independent stylist can be daunting especially if you are new to the industry. Your best bet would be to hire an accountant at first until you feel comfortable doing your taxes on your own. You can even deduct the cost for having someone prepare your taxes for you. Plus, going that route you will be less likely to fail an audit. And you’ll find that once you do get the hang of it, tax season might still be a hassle, but it won’t be something to fear.
-Easy for you, Easy to love-
Latest posts by Deb Hudson (see all)
- Three Ways to Get Your Business Booming - June 15, 2018
- Road map to Success- 5 steps for setting and achieving your goals - March 30, 2018
- #ThisIsOurYear- The #1 thing to make this year the best! - February 15, 2018
- Click to share on Twitter (Opens in new window)
- Click to share on Facebook (Opens in new window)
- Click to share on Pinterest (Opens in new window)
- Click to share on Reddit (Opens in new window)
- Click to share on Google+ (Opens in new window)
- Click to email this to a friend (Opens in new window)
- Click to print (Opens in new window)