Salon owners can deduct most legitimate business expenses on Schedule C or as a corporation. Common deductions include: rent or mortgage interest for the salon space, payroll and contractor payments, supplies and retail inventory, equipment purchases and depreciation, software subscriptions, marketing and advertising costs, continuing education and licensing fees, business insurance, professional services like accounting, and a portion of your cell phone if used for business. Booth renters deduct differently but the categories overlap. The single biggest mistake salon owners make is not tracking small purchases throughout the year. In 30 years behind the chair I have filed as both a salon owner and a renter, and the small stuff is where the money hides. A $50 receipt for color supplies is a real deduction. Over a year those small amounts can add up to $4,000 or more.
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What can hairstylists write off on taxes?
A self-employed hairstylist can write off almost everything it takes to do the job: booth rent, color and product, shears and tools, capes and towels, continuing education and classes, license and insurance, a business phone, mileage to work-related errands, and a portion of a home office. Booth renters and commission stylists both report on Schedule C or against their income and the categories overlap heavily with salon owners. The money hides in the small stuff, so keep every receipt. A hairstylist deduction checklist can save $3,000 to $8,000 a year.