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Tax Credits and Compliance Simplification for Beauty Service Businesses.

This law extends an existing employer tax credit (for Social Security taxes paid on employee tips) to the beauty service industry, including salons and spas. It also establishes a "safe harbor" program to protect compliant business owners from IRS tip audits, provided they maintain educational and reporting standards. Furthermore, it mandates new reporting requirements for income generated from renting space (booths) within these establishments, increasing financial transparency for independent contractors.
Key points
New tax credit available to owners of hair salons, barbershops, nail salons, and spas related to employee tip taxation.
Creation of a safe harbor program shielding beauty service employers from IRS tip audits if they implement required training and documentation.
Mandatory reporting to the IRS of rental income ($600 or more annually) received from independent stylists or barbers renting space.
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Additional Information
Print number: 118_S_45
Sponsor: Sen. Cardin, Benjamin L. [D-MD]
Process start date: 2023-01-24
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Summarized by: gemini-flash-latest
Source data: api.congress.gov
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OFFICIAL LEGAL TITLE

Small Business Tax Fairness and Compliance Simplification Act

FREQUENTLY ASKED QUESTIONS

What is the official ID of this bill?

The official print number for this legislation is 118_S_45.

Which chamber initiated this legislation?

This legislation was initiated in the Senate.

When did the legislative process begin?

The process officially started on 2023-01-24.

What are the main provisions?

Key points include:

  • New tax credit available to owners of hair salons, barbershops, nail salons, and spas related to employee tip taxation.
  • Creation of a safe harbor program shielding beauty service employers from IRS tip audits if they implement required training and documentation.
  • Mandatory reporting to the IRS of rental income ($600 or more annually) received from independent stylists or barbers renting space.
What is the specific legal status?

The current status is Expired.

Where can I read the full text of this legislation?

The full official text is available at: View full text

Who is the primary sponsor?

The primary sponsor is Sen. Cardin, Benjamin L. [D-MD].

What is the latest detailed status?

The latest detailed status is: Introduced in Senate

Is this summary verified?

Yes. This content was analyzed by AI and verified by the Lustra Judge System on 2025-12-26.

CATEGORIES

Taxes Labor Economy