Key Takeaways: Tax season can be stressful for barbers, but it doesn’t have to be. By using a tax season checklist, you can complete your taxes for barber professionals with confidence.
Whether you’re putting the finishing touches on a perfect taper, providing a sense of community, or growing your business, being a barber means tackling a variety of challenges with confidence and skill.
In other words, there’s not much you can’t do.
So, why are taxes for barber professionals so daunting? If you ask us, it’s just like anything else–you have to make an intentional effort to learn about and complete them properly.
While you don’t have to become a tax expert, a little knowledge can go a long way during tax season. That’s why we’ve put together a handy little checklist for you. Equipped with this useful tool, you can handle taxes for barber professionals like a seasoned veteran.
The Ultimate Tax Season Checklist for Barbers
Know Your Tax Status
Before you can file your taxes, you need to know the tax structure of your business. Are you an independent contractor, an employee, a limited liability corporation, a sole proprietor, or something else?
Why does this matter? Because the distinction between various business structures determines how you file taxes, what documents you need to account for, and the standard you’re held to. It might be the single most important factor in determining how to proceed during tax season.
There are a number of ways to figure out your tax classification, so be sure to do your research so you can file with confidence. When in doubt, consult a tax professional!
Organize Your Tax Documents
There are few feelings worse than being chaotic and disorganized during tax season. Scrambling to find documents and information you need is stressful, steals time from more valuable tasks, and can be a downright pain.
When it comes to taxes for barber professionals, staying organized doesn’t happen the night before the deadline–it takes place year-round. Keeping detailed records in an organized fashion also helps you avoid mistakes (and the penalties that accompany them).
Thankfully, you can implement an organizational system easily by using digital or physical filing. Many accounting software programs allow you to automate and streamline this process, making it easier than ever to stay organized for tax season.
Track Your Income and Expenses
There are many compelling reasons to track your income and expenses, and not all of them are tax-related. For example, understanding your cash flow can help you pinpoint where your barbering biz is profitable, where it could be more efficient, and where it is losing money. It simply gives you a deeper knowledge of your business operations and finances.
"Scrambling to find documents and information you need is stressful, steals time from more valuable tasks, and can be a downright pain."
When it comes to taxes for barber professionals, tracking your income and expenses is essential. You need to keep detailed records of all your income sources and all of your business expenses in order to accurately report them on your tax return. If you don’t, there is an increased risk of mistakes, and you could leave money on the table or open the door to penalties and fines.
Know Your Deductions and Keep Records
When discussing business expenses, it’s vital to know what qualifies as a deductible expense and what doesn’t. This is one of the key aspects of taxes for barber professionals, and keeping accurate records could greatly reduce your tax burden.
Deductions are essentially business expenses that you can subtract from your income. This lowers your taxable income, thereby reducing the amount of tax you’re required to pay. Sounds like a pretty great deal, right?
The catch is that not every expense is deductible, and you must provide proof that the deductions you claim are legitimate. Whether you’re writing off your barber insurance premiums or your home office space, you need to know what is deductible and keep receipts rather than claiming deductions at random.
Trust us; it’s better to be safe than sorry when it comes to deductions and the IRS!
File Your Taxes on Time
One of the fastest ways to expose your barbering biz to penalties and fees is to miss deadlines. Filing your taxes on time is essential and ensures that you aren’t responsible for avoidable penalties.
Knowing the tax deadlines is half the battle–it gives you the timeline you need to adhere to. The other, more difficult part of the equation is staying organized and proactive enough to be prepared for those deadlines as they approach.
By following the tips mentioned here, as well as utilizing the quick checklist below, you can set yourself up for tax season success–including filing on time!
Tax Season Checklist for Barbers
- Know your business structure. Are you an employee, independent contractor, sole proprietorship, or something else?
- Know your tax responsibilities. Do you need to pay income tax, quarterly estimates taxes, self-employment taxes, and so on?
- Get familiar with the tax forms. From Schedule C to 1099-NEC, there are a variety of forms that you may need to fill out and file.
- Gather your documents. These include everything from your taxpayer ID and income information to your deductions.
- File on time (or request an extension). You need to know your tax deadlines and be proactive.
- Consider hiring a tax professional. It’s better to be safe than sorry, especially when it comes to taxes for barber professionals.
We hope this tax season guide for barbers helps streamline your tax planning and reduce your stress. If you found it useful, you’ll love all the other resources we share with our barbering community. Subscribe to NAOB to receive the latest updates and be sure to visit our blog for even more barbering tips and tricks.
