Yes. The 2025 expansion of Internal Revenue Code section 45B under the One Big Beautiful Bill Act (OBBBA) extended the FICA tip credit to beauty and personal care businesses, including hair salons, day spas, barbershops, and nail salons with tipped staff. If your team members earn tips and are on payroll, your business can claim back 7.65% of those reported tips as a credit against income tax. There are no upfront costs and no out-of-pocket money. You pay only if a credit is secured.
The key conditions: your tipped team members are W-2 employees on your payroll, and their tips are reported. Booth renters do not count, because they are independent businesses rather than your employees.
Until 2025, the FICA tip credit was limited to food and beverage businesses. The OBBBA expansion brought beauty and personal care in, starting with the 2025 tax year. Beauty claims run for 2025 and forward; there is no retroactive lookback to earlier years for beauty businesses.
The credit equals the 7.65% employer share of FICA tax paid on reported tips, credited dollar for dollar against income tax. Pricing is a pure success fee of 8.75% of the credit recovered. No recovery, no fee. There are no upfront costs and no out-of-pocket money.
Which beauty businesses qualify? Hair salons, barbershops, nail salons, day spas, and estheticians where tipping is customary, as long as the tipped team members are W-2 employees on payroll and their tips are reported.
Do booth renters count? No. Only tips earned by W-2 employees on the business payroll count.
From which year can we claim? Starting with the 2025 tax year, and every year going forward.
What does it cost? The eligibility check is free. There are no upfront costs and no out-of-pocket money. You pay only if a credit is secured. Claims are a pure success fee of 8.75% of the credit recovered, and if there is no recovery there is no fee.
Free check. 8.75% success fee only. No recovery, no fee.