LEGISLATIVE UPDATES IN THE U . S .
Interstate Compacts The 2023 state legislative sessions are under way and many states are considering the Interstate Massage Compact ( IMpact ) and Cosmetology Compact . ( See “ License to Move ” on page 28 of Pulse ’ s February / March issue for more information about both compacts .)
Legislation for the massage compact has been introduced in Washington , Nebraska and Georgia . Legislation for the cosmetology compact has been introduced in Arizona , Kentucky , Georgia and Nebraska .
ISPA members : Reach out to your state legislature , professional association or state licensing board to advocate for your state to join these compacts .
45B FICA Tax Tip Credit Representing the professional beauty industry before Congress , the Alliance for Tax Equity supports passage of the Small Business Tax Fairness and
Compliance Simplification Act ( HR45 and S45 ). This Act , also known as the 45B FICA Tax Tip Credit , will provide beauty business owners access to an existing tax tip credit , the 45B credit . Currently , restaurants are the only industry allowed to utilize this credit for FICA taxes paid on employee tips .
The credit applies to tips received in connection with providing beauty services to a customer or client if tipping employees who provide the service is customary . Beauty services include spa treatments , body treatments , massage , barbering and hair care , nail care and esthetics . The bill also establishes an employer tip reporting safe harbor for beauty service establishments that provides an exemption from certain Internal Revenue Service tip examinations for employers who meet requirements for educational programs , reporting procedures , compliance with tax law and record-keeping .
Compact Legislation for Massage and Cosmetology Introduction
ALLIANCE FOR TAX EQUITY MEMBERS :
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The Alliance needs need support and participation to encourage Congress to pass this legislation that will provide tax fairness to the professional beauty industry and allow owners to keep their money in their business . Learn more about three ways to take action — learn , participate and contribute — at probeauty . org / advocacy / fica . n
Associated Bodywork and Massage Professionals Associated Hair Professionals Associated Nail Professionals Associated Skin Care Professionals Cosmetologists Chicago The Esthetics Council Intercoiffure America Canada International Franchise Association International Salon Spa Business Network International SPA Association National Association of Barber Boards of America National Association of Women Business Owners National Interstate Council of State Boards Personal Care Products Council Professional Beauty Association Professional Beauty Employment Coalition
FEATURED SOURCES
Massage Cosmetology
MATT SHAFER is deputy policy director of the National Center for Interstate Compacts at The Council of State Governments compacts . csg . org
MYRA IRIZARRY REDDY is government affairs director of the Professional Beauty Association probeauty . org
50 PULSE n APRIL 2023