Tax Season Alert: Can a Salon Get in Trouble For Stylists Not Reporting Tips?

Albert Einstein once said “The hardest thing in the world to understand is the income tax.” And it’s true. With so much misinformation out there, sometimes it’s hard to pinpoint exactly what is taxable income. This is especially true for employees in service industries who rely heavily on tips—restaurant servers, bartenders and hairstylists. A concerned BTC Member works at a salon where she has noticed other stylists are not recording their tips. At this particular salon, all stylists record their tips in a “community” notebook of sorts, so as to allow the owner to record the tips as part of the employees’ income. The stylist (more…)