How to Tackle Tax Season Like a Beauty Boss
What Every Cosmetologist Should Know About Tax Season
If you read the phrase “tax season” and rolled your eyes, we’re right there with you. We’re not going to sit here and pretend that taxes are somehow fun or seamless–let’s just face it, they kind of suck.
The bad news? Taxes are necessary. You’ve got to do them.
The good news? They actually don’t have to be the worst season of the year.
In fact, if you implement a few tweaks we’re going to discuss, they can be downgraded from “absolutely terrible” to “only a little insufferable.”
No, we’re not going to promise that tax season will magically become fun (spoiler, it won't). But these tips can help you tackle tax season like the total beauty boss that you are. And that’s worth a read, in our opinion.
(P.S., we've got even more tax help for you right here with our comprehensive cosmetology tax eBook).
How to Tackle Tax Season Like a Total Beauty Boss
Understand Your Tax Deadlines
Know when things are due. Sure, it might sound like simple advice, but let’s face it–nothing is straightforward in the tax world.
Make sure you have a solid understanding of your actual deadlines (like paperwork, fees, etc.) long before they’re due so you can adequately plan out what needs to be done.
Don’t Wait Until the Last Minute
If we could offer you one piece of advice for this tax season, we’d ask you not to wait until the last minute to file.
Even if you think the process is going to be pretty standard or easy-peasy, there’s always some last-minute roadblock that’s bound to pop up–so you’re going to want to give yourself plenty of time to deal with those types of issues.
You have a lot going on–and taxes rarely go super smoothly. You don’t want to put yourself in a position where your business is struggling because you’re having a hard time getting your taxes completed.
And what you really don’t want are late tax penalties–trust us.
Know the Tax Hacks
The best hack we can offer you? The Employee Retention Credit. Never heard of it?
Basically, this is a federal payroll tax for businesses that were impacted by the pandemic (hello, that’s you for sure) who were able to keep employees on their payroll and away from unemployment.
This could entitle employers to a credit of up to 50% of qualified wages used to pay employees from March 12, 2020, until the end of 2020.
This tax credit technically expired at the end of 2021, but you can retroactively claim it–and that’s definitely something you should look into.
Can’t file it this year or missed the deadline? Know that you can file it next year–but you might want to get a move on it. Who knows when they’ll change the qualifications on it.
But this isn’t the only tax hack out there! Know your tax hacks and know serious deductions to give you a better idea of what you could be writing off and benefiting from! There’s no shame in the tax hack game, OK!
Be Aware of Your Business Expenses & Deductions
Know what you can write off! As a business owner, there’s a lot you can write off to make your taxes a little more tolerable.
But you need to know what qualifies and what does not. Business expenses and deductions can include things like:
- Professional additions (like licensing, legal services, publications, conventions, liability insurance, etc.)
- Shop supplies (products, hair care, cosmetology must-haves, cleaning tools, towels, etc.)
- Equipment (sinks, chairs, couches, computers, etc.)
- Marketing (like advertising, entertainment, meals, charities, donations, gifts, etc.)
- Business tools (internet, phone services, utilities, hosting fees, leasing fees, etc.)
Hire Help–Seriously!
Think about it this way. You wouldn’t advise a client who has never colored their own hair to just up and give it a try.
Why? Because they’ve never done it before–they could damage their hair! Instead, you’d tell them to hire a professional to help them learn how to do it or handle it for them.
That same principle applies to taxes.
Listen, you didn’t go to school and become a tax CPA (at least, most of you didn’t, right?). That’s not a bad thing–but it does mean that taxes might be a whole lot more than you’re able to handle while running your business.
And you know what? There’s no shame in that game. Like, at all.
Hiring help is a wise career move, and lots of the folks you look up to probably do that every single year. It might be costly, but it’s fair to consider this an investment to ensure you’re doing everything by the book, getting those deadlines tackled, and getting the most bang for your exemption buck!
Taxes aren’t fun, but they don’t need to be a total disaster. Our advice?
Take this blog to heart and really get into your taxes early (even if you can’t get this year, there’s always next year).
Plus, we really want to emphasize that hiring a tax expert can be a wise move for you!
Remember, you can’t rock every single aspect of your business by yourself–there’s no shame in hiring a pro to help you do things right!
So, tell us–are you ready to tackle tax season? Let’s do this thing.
If you’re looking for even more tax advice, helpful insight, career-boosting tips, and even hot industry gossip, Elite Beauty Society has got your back.
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