Starting a limited liability company (LLC) for your body waxing business can provide several benefits.
Most importantly, an LLC structure offers limited liability to its owners, which can protect their personal assets from lawsuits and creditors.
For a body waxing business, lawsuits can arise from things like burns and other waxing-related injuries that give rise to medical damage claims.
LLCs are also affordable, highly flexible (from a tax point-of-view), and can make your body waxing business seem more credible.
Recommended: Use Northwest to form an LLC for $29 (plus state fees).
Do I Need an LLC for a Body Waxing Business?
LLCsmoney
You should form an LLC when there's any risk involved in your business and/or when your business could benefit from tax options and increased credibility.
LLC Benefits for a Body Waxing Business
By starting an LLC for your body waxing business, you can:
- Protect your savings, car, and house with limited liability protection
- Have more tax benefits and options
- Increase your business’s credibility
Limited Liability Protection
LLCslimited liability protection
Body waxing businesses will benefit from liability protection because personal care and grooming businesses, including body waxing businesses, face the risk of client injury, workplace accidents, and even data breaches.
Example 1: A customer receiving a body wax from your business has a severe allergic reaction to the waxing strips, necessitating urgent medical attention. She decides to sue your business for the medical costs of these injuries, claiming it is the fault of your business. In this instance, limited liability would protect you and your personal assets from being held responsible for satisfying this compensation.
Example 2: While applying the wax for a treatment session, an employee of your body waxing business ignores the complaints of the customer, who stated that the wax was too hot. After it is removed from the customer’s body, it is revealed that he has suffered third-degree burns. He sues your business on the basis that its negligence led to his injuries. If found liable to pay the plaintiff damages, this liability could only be imposed on your business’s assets.
Example 3: After an employee of your body waxing business injured several patients while carrying out his duties, your business let him go. However, the ex-employee felt that the way in which he had been dismissed breached his contract, and so sued your business for wrongful dismissal. Any liability to compensate the plaintiff would be precluded from extending to your personal assets.
Example 4: A customer turns out to be allergic to the brand of body wax your business uses and suffers a severe reaction to your wax. The customer asks you to cover the resulting hospital fees.
An LLC will also protect your personal assets in the event of commercial bankruptcy or loan default.
To maintain your LLC's limited liability protection, you must maintain your LLC's corporate veil.
LLC Tax Benefits and Options for a Body Waxing Business
LLCs, by default, are taxed as a pass-through entity, just like a sole proprietorship or partnership. This means that the business's net income passes through to the owner's individual tax return.
The business’s net income is then subject to income taxes (based on the owner's tax bracket) and self-employment taxes.
Sole proprietorships and partnerships are taxed in a similar way to LLCs, but they do not offer limited liability protection or other tax options.
S Corp Option for LLCs
An S corporation (S corp) is an IRS tax status that an LLC can elect. S corp status allows business owners to be treated as employees of the business (for tax purposes).
S corp tax status can reduce self-employment taxes and will allow business owners to contribute pre-tax dollars to 401k or health insurance premiums.
The S corp status requires that the business pay the employee-owner(s) a reasonable salary for the work they perform.
In addition, the business might need to spend more on accounting, bookkeeping, and payroll services. To offset these costs, you'd need to be saving about $2,000 a year on taxes.
We estimate that if a body waxing business owner can pay themselves a reasonable salary and at least $10,000 in distributions each year, they could benefit from S corp status.
You can start an S corp when you form your LLC. Our How to Start an S Corp guide will lead you through the process.
Credibility and Consumer Trust
Body waxing businessesconsumer trust
Businesses gain consumer trust simply by forming an LLC.
A growing business can also benefit from the credibility of an LLC when applying for small business loans, grants, and credit.
Northwest will start an LLC for you for just $29 (plus state fees).
Get Started
How to Form an LLC
Forming an LLC is easy. There are two options for forming your LLC:
- You can hire a professional LLC formation service to set up your LLC for a small fee
- Or, you can choose your state from the list below to start an LLC yourself
Select Your State
- Alabama LLC
- Alaska LLC
- Arizona LLC
- Arkansas LLC
- California LLC
- Colorado LLC
- Connecticut LLC
- Delaware LLC
- Florida LLC
- Georgia LLC
- Hawaii LLC
- Idaho LLC
- Illinois LLC
- Indiana LLC
- Iowa LLC
- Kansas LLC
- Kentucky LLC
- Louisiana LLC
- Maine LLC
- Maryland LLC
- Massachusetts LLC
- Michigan LLC
- Minnesota LLC
- Mississippi LLC
- Missouri LLC
- Montana LLC
- Nebraska LLC
- Nevada LLC
- New Hampshire LLC
- New Jersey LLC
- New Mexico LLC
- New York LLC
- North Carolina LLC
- North Dakota LLC
- Ohio LLC
- Oklahoma LLC
- Oregon LLC
- Pennsylvania LLC
- Rhode Island LLC
- South Carolina LLC
- South Dakota LLC
- Tennessee LLC
- Texas LLC
- Utah LLC
- Vermont LLC
- Virginia LLC
- Washington LLC
- Washington D.C. LLC
- West Virginia LLC
- Wisconsin LLC
- Wyoming LLC
For most new business owners, the best state to form an LLC in is the state where you live and where you plan to conduct your business.
Do LLCs Need Insurance?
Just as is the case with all businesses, LLCs need insurance. Your body waxing business will require insurance to guard its assets against the very unique risks it faces on a daily basis.
The difference between insurance and limited liability is in the type of asset that is protected. Limited liabilities protect the owners’ personal assets, while insurance protects the business’s assets.
Common Situations Business Insurance May Cover for a Body Waxing Business
Example 1: A customer fails to inform your business that he is allergic to a particular brand of body wax you commonly use. He suffers a severe reaction to your wax and requires prompt medical attention and an ambulance. If found liable, your business would likely be covered by general liability insurance, including court-ordered damage payments or any settlements reached.
Example 2: A customer dozes off during his session and wakes up to find that he has been treated according to a different customer’s scheduled appointment. He has rashes on his body where certain oils were applied. He claims that his health is a crucial element of his professional life and files a lawsuit to cover a period of time that he cannot work. If liable for the error, your company would probably be covered by general liability insurance for resulting damage estimates or a settlement.
Example 3: A customer is accidentally sealed in a tanning bed due to a broken mechanism. When she is finally released, her skin looks red, and she is visibly shaken. She says she is traumatized and in great pain. If found liable for this incident, your business would probably be covered by general liability insurance for any damages owed or settlements reached.
Other Types of Coverage Body Waxing Businesses Need
While general liability is the most important type of insurance to have, there are several other forms of coverage you should be aware of. Below are some other types of insurance all body waxing businesses should obtain.
Professional Liability Insurance
Body-waxing businesses perform delicate services that are profoundly impactful to their clientele’s physical comfort. For that reason, this is one business that absolutely needs professional liability insurance. If a customer doesn’t like the way their procedure turned out or feels that they have been significantly wronged by your methodology, they may opt to sue. Rather than pay huge amounts in damages, a smart body waxing business will be insured for professional liability and deflect most of the financial damages incurred by lawsuits of this nature.
Commercial Property Insurance
On location at its storefronts, a body waxing business will maintain and utilize cosmetic equipment, supplies, machinery, and even inventory. One of the most serious hits a business can take is to lose massive amounts of money in unexpected disasters like a fire or violent weather. If your business is impacted by such a loss, you’ll be looking at not only the loss of your material assets but the cost of reacquisition. Commercial property insurance provides coverage for commercial inventory/equipment as well as damage to owned real estate.
Workers' Compensation Insurance
While a body waxing business could function with you as its exclusive owner and worker extraordinaire, you have a lot to gain by bringing employees on board to expand the business and increase revenue. That being said, part-time and full-time employees legally require you to carry workers’ compensation insurance. Through this policy, employees will be covered for injuries sustained on the job. They will also be provided disability and death benefits, improving the financial security of not only your workers but of their families as well.
Product Liability Insurance
Many body waxing businesses also sell products. In an industry like health and cosmetics, your business is probably better off with something to protect it from lawsuits that arise through product use. For instance, if a customer sustains an injury or other medical damages due to a product you sold, you could be held liable for the cost of medical treatments. Don’t be caught off guard by a surprising misuse of your merchandise—product liability insurance is drafted for exactly this reason.
Should I Start an LLC FAQ
Choosing the right business structure depends on your business’s unique circumstances and needs. However, unless your business is very low risk (like a hobby), an LLC is likely the better option.
Visit our LLC vs. Sole Proprietorship guide to learn more.
At a minimum, you’ll need general liability insurance and commercial property insurance. You will also need workers’ compensation insurance if you have employees.
Read our Body Waxing Business Insurance article for more info.
The costs of starting a body waxing business are fairly substantial. Be prepared to allocate around $5,000 to get your business off the ground. The rent for your body waxing facility should cost around $1,000 per month, leaving the rest of the budget to buy supplies, body hair removal equipment, and furniture.
Visit our How to Start a Body Waxing Business guide to learn more about the costs of starting and maintaining this business.
Some of the main operating expenses for a body waxing business are rent, insurance, equipment and supplies, and employee salaries.
Learn more about running a body waxing business.
A body waxing business makes money by charging customers to remove body hair. Some body wax businesses also offer other personal care services.
Learn more about starting a body waxing business.
Body waxing businesses can stand alone, or they can be part of a broader personal grooming and care company that offers other services. This gives business owners more opportunities to grow the business in the future.
A successful body wax business can make over $50,000 of profit in a year.
Learn more about starting a body waxing business.
