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Tax Write-Offs Every Hairstylist Should Know



female hairstylist in a salon

I heard you asking.

 

You know, the question all hairstylists are asking this time of year…what can I write off on my taxes?

 

Well, even if you didn’t personally ask me, I’m sure it’s on your mind right about now! You’re probably wondering how you’ll be able to figure out all this tax stuff before the deadline.


If you haven’t been actively seeking the answers then I’m glad you’re here. In fact, many hairstylists forget to ask a professional what steps they should take to prepare for tax time.


And if they aren’t prepared, they’ll risk losing money because they don’t understand what they can and can’t write off. They also put themselves at risk of getting in trouble with the IRS. Yikes!


So let’s uncover the answer to this great question.


First, you may be wondering how this girl knows. Unfortunately, I learned this lesson the hard way because for 15 years, a CPA at a reputable firm was taking care of my taxes. At the time, I owned my own salon in the Bay area and was thrilled because he seemed to be saving me so much money. I hardly owed any taxes all those years.

 

And then right before tax season, he died and no one in his office could figure out how he did my taxes. Clearly he wasn’t following the law, and I had no idea. So when the new CPA took over, she did our taxes the correct way, and I owed money that year which created a red flag to the IRS.

 

Yep, I was audited. It didn’t matter that someone else did my taxes incorrectly. Ultimately, I was responsible so I had to endure two agonizing years in that audit and had to pay back a lot of money. It was a horrible experience, and I never want to suffer anything like that again.


So now I caution new hairstylists to be aware that they need to be watching their finances closely and make sure the professional they hire is trustworthy.


Other Lessons I Learned.


Never miss a quarterly tax payment. You’ll end up paying penalties and interest on top of the estimated quarterly amount. Put a reminder in your phone or write the deadline on your calendar. Whatever method works for you - just don’t pay late or skip your tax payments.

 

Don’t hide money. I totally understand the temptation to tuck that cash right in your pocket but keep in mind there can be consequences if you do that repeatedly. It might result in a significant change in your income that could trigger a red flag to the IRS. Also, if you want to get a loan to buy a car or a house, your reported income would be much lower and you might not be able to qualify.

 

Find a reputable CPA to help. The CPA can confirm what is and what isn’t deductible and make sure you are in compliance. Don’t rely on a Google search. The tax laws change frequently and you don’t want to be relying on outdated information. The fee to meet with a CPA is worth it and it’s a tax write off!


5 Writes-Offs That Will Make A Huge Impact On Your Income.

 

Clothing or Uniforms. Clothing can only be written off if the salon you are working in has a dress code. Uniforms would include an apron or smock that you wear to protect your clothing.

 

Supplies. This includes anything that you use to perform your skills, such as scissors, combs, hair clips, products, precious blow dryers, flat irons…you get the picture.

 

Education. This speaks for itself. In my opinion, you should have a lot of write-offs for education as you continue to master your craft. Education should be a life-long priority.

 

Licensing fees. This includes your cosmetology license, business license, and state or city licensing to perform your business.

 

Start-up costs and operating costs. These include any expenses that you’ve acquired to start and maintain your business. Examples are capes, décor for your station or suite, a booking app, marketing expenses, etc.

 

This is your business. It’s your livelihood so make sure to educate yourself about finances. Would you rather give your hard-earned money to the IRS or keep it in your own piggy bank?

 

If you would like a more comprehensive list of things you can write off, check out my Tax Deductions for Hairstylists checklist.


Always check with a tax professional to confirm your deductions each year as the tax laws can often change.


 

If your skills aren’t where you want them to be, I highly encourage you to find a trusted hairstylist to mentor you.

 

And if you don’t have anyone available who's at the level where you want to be, consider On Point Hair Academy. There are many options available to help you advance your haircutting skills, your business expertise, your personal growth and your client relationships.


On Point Hair Academy education and Own Your Chair blog were created for stylists like you who need just a little help (or a lot of help) in different areas of their hairstyling business. You don’t have to take this hairstyling journey alone.

 

Let’s connect!

 

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Remember, your work is not about you. Your work is about how you make your clients feel.

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