Interview with Myra Reddy on the Salon Tip Tax
Myra Reddy is the Director of Government Affairs and Industry Relations for the Professional Beauty Association. We asked Myra to come on specifically to talk about the “Tip Tax” A program that’s been controversial in the restaurant and other service industries, but has potential to change the financial model of the salon industry.
What is the FICA Tax Tip Credit?
In 1993 Congress passed the 45B FICA tax tip credit allowing restaurants to claim a dollar-for-dollar tax tip credit on the employer portion of FICA taxes that businesses pay on tips that employees receive directly from their customers.
As the second-highest tipped industry, salons should receive parity with the restaurant industry in the tax code, but presently they do not. Including the salon and spa industry in this legislation could help our industry greatly.
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Credits: Volume Up is a Tease Media production. This episode was produced by Monica Hickey, Steven Jotterand, and Madeline Hickey.