How to File 1099 Forms as an Independent Spa or Salon Contractor
Tax season can feel stressful and overwhelming, especially if you’re an independent contractor. But you can be prepared and have more peace of mind. We will explain how to file 1099 forms as an independent Spa or Salon Contractor, so you can stay compliant with the law and on track in your business.
If your net earnings from self-employment are $400 or more, you will file a tax return with the Internal Revenue Service (IRS). Along with your 1040 form, you’ll file a Schedule C to calculate your net income. You can file a Schedule C-EZ form if you have less than $5,000 in business expenses.
Good Bookkeeping
Maintain accurate, up-to-date books throughout the year, tracking all of your expenses and saving receipts to support your tax write-offs. Keep copies of bank statements, invoices, 1099-MISC forms, business balance sheets and ledgers, and previous tax returns.
Report Tips: As an independent spa or salon owner, tips are taxable. Keep track of all income including tips, which you will pay income tax on.
Tax Deductions
Don't miss the opportunity for big tax savings on write-offs. While being an independent contractor means you have to pay more in self-employment taxes, there is an upside: you can take business deductions. These business deductions reduce the amount of profit you pay income taxes on. The important thing when it comes to deducting expenses is to make sure you track them throughout the year. All of your reasonable and necessary business-related expenses are deductible.
Pros outsource and have the experts in their corners
You'll never want to overpay or underpay in taxes and that's why good bookkeeping is essential. Once your books are prepared you can hand them off to your tax accountant (CPA) to file your taxes. If you need to outsource your bookkeeping, get a free bookkeeping estimate today!