With the final crunch of tax time falling upon us, many techs are rushing to finish through their final stages of tax forms. I recently found out just how complicated taxes can be in the salon industry. I wrote an article in the April issue about worker misclassification and I also took an IRS class at the ISSE show in Long Beach this January.
Taxes can be a convoluted process for techs to go through because so many in this industry are categorized as independent contractors. Though many of these independent contractors are classified incorrectly and should be labeled as employees, the process of switching classification can be difficult and takes time. So salon workers that are considered self-employed, (this includes booth renters as well as independent contractors), have to do the best they can to take care of themselves and make sure they are at least getting as much as they can out of their tax returns.
The most important thing to remember is to keep yourself as informed as possible and read up on your classification status and all of your possible tax exemptions. Here are some links to IRS guidelines posted online.
Filing Requirements for Self-Employed Individuals
IRS Publication 15-A, Employer’s Supplemental Tax Guide
Instructions for Form 1099-MISC