Salons & barbers in United States

2026-08-02

"No tax on tips" gives your salon nothing. Used properly it is still the cheapest raise you will ever hand out.

If you run a salon or barbershop with tipped staff, 2026 is the first year the IRS makes you report tips a new way, and the year is already seven months old. The honest position on money: this cuts nothing off your tax bill, adds a little admin, and hands you one genuinely valuable thing. Your team can get a federal tax break on their tips that costs you absolutely nothing, but only if your card machine is set up right and somebody tells them about a form.

2026-07-10

The new FICA tip credit just changed the booth-rental-versus-employee math for US salons

For years the tax math pushed salon owners one way: rent out the chairs, put stylists on a 1099, and dodge the employer payroll tax. A federal law signed on 4 July 2025 quietly changed one side of that ledger. If your stylists are employees, you can now claim a federal tax credit on the payroll tax you pay on their tips, a credit salons never had before. Here is what it does to your take-home profit first, then to the booth-rental decision, and to what your salon is worth when you sell.