On The Gina Bianca Podcast, stylist and educator Gina Bianca sat down with David Ciampi, Managing Principal at Ciampi Tax and Financial LLC, for a conversation about best practices that can make a stylist’s business and/or a salon business financially successful.

David has been advising business owners for over 30 years, helping everyone from independent stylists to full-scale salons understand their numbers, build sustainable operations, and plan for long term success. In this episode, he discusses core steps needed in establishing a new business as well as growing your current operations. Recorded in 2021, David and Gina touch upon the tax laws of that period; however, they also shared timeless guidance that every professional can learn from.

Ciampi Tax and The Network/Gina Bianca will be co-hosting a webinar on the One Big Beautiful Bill to discuss how this new tax act will specifically affect the beauty industry. Join us on December 1st at 10:00 AM EST. Register here.

Listen to Gina’s full podcast episode here. Key takeaways from the podcast:

1. Boundaries Matter

David emphasizes the importance of separating you from your business where it matters most. From day one, structure matters:

• Set up a separate bank account and business credit card.

• Never co-mingle personal and business funds. Put aside your start-up money and then keep things separate.

• Obtain a Tax ID (TIN) and register for state and sales tax IDs right away.

These steps help save headaches when bookkeeping and will protect you legally and financially down the line.

 

2. Build a Trusted Team of Advisors

Gina stresses that you need two best friends in business: your accountant and your lawyer. With the abundance of free online advice, misinformation spreads fast. David often hears from clients who have received bad tax tips from social media or even well-meaning friends and family.

David’s advice: “Dismiss any rumors”. “If something sounds good, maybe it’s too good. And you do need somebody that you trust that you can ask those questions to.”

Gina’s motto: “Live in consultation”. She also shares that your accountant should be organized, up-to-date, proactive, and have the heart of a teacher.

 

3. Understand Your Financial Picture

Don’t wait until tax season to get help. Coming in once a year with “a bag of receipts” costs more than setting things up correctly from the start. Everyone’s skill levels vary when it comes to bookkeeping. David recommends beginning with pen and paper, then moving to excel until you build the confidence to use QuickBooks. Know your:

• Cash flow: where your money is going

• Gross and net profit

• Quarterly tax obligations

Staying on top of these metrics gives you control and helps your accountant guide you toward smarter decisions.

 

4. Choosing Your Path

In the beauty industry, your business model shapes your financial picture. Each path offers its own benefits and setbacks. Deciding which to choose depends on your wants and resources as an individual.

 

Renting a Chair

The booth rental model gives you full control — your schedule, your clients, your pricing. But with that independence comes responsibility:

• You’re self-employed and must pay your own taxes (including self-employment tax).

• You’ll need your own liability and malpractice insurance.

• Budget for your own advertising, supplies, and continuing education.

Subcontracting

This middle ground allows stylists to work independently within another business. Subcontractors typically:

• File their own taxes but receive a Form 1099 (not a W-2).

• Have some freedom but must still follow IRS guidelines to avoid misclassification.

• Can deduct business expenses but must stay compliant and document everything.

Becoming an Employee

As an employee (W-2), taxes are withheld automatically, and you may receive benefits like unemployment or workers’ comp. However, you’ll have less flexibility with pricing, hours, and branding.

Opening Your Own Salon

Ownership offers the highest earning potential and the most risk.
You’ll need:

• A solid business plan

• At least two months of working capital (for rent, insurance, marketing, and personal expenses)

• A clear ownership structure (LLC, partnership, or corporation)

• Written operating agreements if you have partners or staff

 

5. Know Your Entity Type

Your legal entity determines how you’re taxed, protected, and paid.
Here’s how David summarizes each:

• Sole Proprietorship: Easiest to set up but no personal liability protection.

• LLC: Flexible, protective, and great for small businesses.

• Partnership: Requires an operating agreement and clear roles.

• S-Corp or C-Corp: May offer tax advantages depending on income level and current laws.

• Franchise: Comes with built-in systems but also costs and restrictions.

Each option has trade offs. Working with a professional ensures you’re aligned with both your goals and compliance requirements.

 

6. Thinking Long Term: Retirement & Health Savings

Self-employed professionals often neglect retirement planning, but David urges stylists to build it early. Options include:

• IRA or Roth IRA

• SEP IRA

• Solo 401(k)

• SIMPLE IRA

• 401(k) with profit sharing

Pair with a Health Savings Account (HSA) to reduce taxable income while preparing for future medical costs.

 

For salon owners, success isn’t just about great hair; it’s about great systems, structure, and strategy.

• Start strong with the right foundation.

• Build a team you can trust.

• Stay educated and plan ahead.

Because when your business runs smoothly, your creativity can truly shine.

 

Ready to Build a Stronger Financial Foundation?

Whether you’re renting a chair, running your own salon, or managing a growing team, having the right financial strategy changes everything. We help beauty professionals structure their businesses, stay compliant, and make confident financial decisions.

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