How to start a tanning salon: licensing, the tanning tax, equipment, records and software

The short answer: eight steps, in this order

Opening a UV tanning salon means setting up a regulated business. This order avoids expensive rework, such as a lease your state will not license.

1. Read your state's tanning law before you sign a lease or order beds.
2. Register the business, get an EIN, and apply for the state and local permits.
3. Set up the 10% federal tanning tax and the quarterly Form 720.
4. Buy units with the federal labels and manuals, and plan for lamps.
5. Set up client records and an incident log before the first session.
6. Put your state's consent form and age check in place.
7. Work out costs with a worksheet and a break-even count.
8. Choose software that enforces those rules.

Each step cites the rule behind it. The state examples are Florida, Ohio, Rhode Island and Texas; other states differ.

Step 1: check your state's tanning law first

No federal agency licenses tanning salons. The federal performance standard for tanning beds and booths, 21 CFR 1040.20, sets requirements for the products, and its duty to supply instructions falls on each manufacturer. Licensing, age limits, consent forms, records and inspections come from state law, and sometimes from a county health department acting for the state.

Florida's Department of Health FAQ adds Florida-only details. A tanning business cannot run from a home unless a solid wall separates it from the living quarters and it has its own outside entrance. Insurance is optional, but a salon that carries it must show proof and limits on request. The owner or operator must finish training before opening, and employees who help customers must be trained within 30 days of hire.

Find your state on tanning laws by state, or compare nine states in the license requirements guide.

Step 2: register the business and line up local permits

The SBA says most small businesses need a combination of licenses and permits, and that requirements and fees vary with your business activities, your location and government rules. Check with your state, county and city, not just the tanning agency.

Get an Employer Identification Number (EIN), your federal tax ID. The IRS says you never have to pay a fee for one, and you can apply online. A tanning business needs its EIN before it files its first Form 720.

Ask about local permits, such as a certificate of occupancy or fire inspection, before the build-out. Sales tax on tanning, spray tans and retail is a separate question for your state's revenue department.

Step 3: plan for the 10% federal tanning tax

Section 5000B of the tax code imposes a tax of 10 percent of the amount paid for an indoor tanning service, meaning tanning with a product that has one or more ultraviolet lamps. The client pays it, the salon collects it, and if the client does not pay it, the salon does. The IRS says it does not apply to spray tans or to topical creams and lotions.

Decide how you will price first. Under the Treasury regulation, 26 CFR 49.5000B-1, the amount paid is presumed to include the tax if the tax is not separately stated. In the regulation's example, a $15.00 tan plus tax carries $1.50 of tax; a $15.00 price including tax carries $1.36.

• File Form 720 every quarter and enter the tanning tax in Part II on the line for IRS No. 140.
• Returns are due April 30, July 31, October 31 and January 31. No deposits are required; you pay with the return.
• Keep copies of your returns and records of every transaction that show the correct tax was paid. Keep records that support a claim or an exemption at least 4 years from the latest of the date the tax became due, the date you paid it, or the date you filed a claim.

More in the tanning excise tax guide and tanning tax on bundles.

Step 4: buy equipment with the federal labels, and plan for lamps

Tanning beds and booths are class II medical devices under 21 CFR 878.4635 and must meet 21 CFR 1040.20. Before you accept a unit, new or used, check for:

• A unit label with the "DANGER—Ultraviolet radiation" warning, exposure positions, an exposure schedule with session spacing and the maximum exposure time in minutes, and the lamp type to use (1040.20(d)(1)), readable just before use (1040.20(d)(3)(i)).
• The boxed statement "Attention: This sunlamp product should not be used on persons under the age of 18 years." in letters at least 10 millimeters high, readable with the canopy or booth door open or closed (878.4635(b)(6)(i)(A)).
• A control on the unit that lets the person inside stop the UV at any time (1040.20(c)(3)).
• A timer whose longest setting does not exceed the labeled maximum exposure time, with no setting off by more than 10% of the maximum timer interval (1040.20(c)(2)).
• As many sets of protective eyewear as the maximum number of people the instructions allow at once (1040.20(c)(4)).
• The user manual, covering the timer, exposure time by skin type, and compatible replacement lamps and eyewear (1040.20(e)(1)), plus cleaning and disinfection instructions (878.4635(b)(6)(i)(B)).
• Lamps labeled "Sunlamp—DANGER—Ultraviolet radiation. Follow instructions.", with the model and "Use ONLY in fixture equipped with a timer." (1040.20(d)(2)).

Plan where the timer controls go: Texas requires the timer to be located so a customer cannot set or reset their own exposure time (145.008(d)).

Plan lamps as a running cost. The federal standard sets no lamp-hour limit, Rhode Island requires an hour meter on every unit, and Florida's FAQ says to keep documentation that a replacement lamp is compatible. See tanning bed lamp replacement and FDA tanning bed regulations.

Step 5: set up records before the first client

Records must exist from the first session. In Texas, the customer record, kept at the salon at least until the third anniversary of the client's last session, holds the date and time of each use, its length, any injury or illness, the signed consent statement, the skin type the client picks on the Fitzpatrick scale, and any family or past medical history of skin cancer. Texas also requires an incident log of alleged injuries, sessions without protective eyewear, mechanical problems and complaints, kept three years (145.008(i) and (j)).

Florida requires a record of each customer's use for at least 4 years, and Rhode Island at least three years, electronic records allowed. For the tanning tax, the Form 720 instructions say to keep records that support a claim or an exemption at least 4 years. The recordkeeping guide compares four states, and the inspection checklist shows what an inspector asks to see.

Step 6: consent forms and age checks

No federal rule makes a client sign anything; the federal warning is on the unit's label. Signed statements come from state law. Texas requires photo ID and a signed statement before the first use and each time a client signs or renews a contract (145.008(e)). Rhode Island requires a signature at the first visit and at least every 12 months after that.

Age rules differ even more. Texas and Rhode Island bar anyone under 18. Florida lets a minor between 14 and 18 tan only with a parent's or legal guardian's signed statement on file, and a child under 14 must be accompanied by a parent or guardian. Florida's FAQ adds that the salon must know each client's age, and every record missing the age or birth date counts as a violation.

Record the date of birth, not just an age. The tanning consent form guide compares six states' wording and signing schedules.

Step 7: a startup cost worksheet instead of a guess

We found no reliable published figure for what it costs to open a tanning salon, so build your own. The SBA's startup cost guide splits costs into one-time expenses and monthly expenses, and says to count at least one year of monthly expenses, with five years ideal.

Then find your break-even point with the SBA's formula, fixed costs divided by (price minus variable costs), using a session as the unit.

1. Net price per session: if your prices include the tanning tax, divide by 1.10 to remove it, following the regulation's tax-included method. The tax is not revenue.
2. Variable cost per session: lamp cost per hour x session minutes / 60, plus supplies and electricity per session.
3. Sessions to break even each month: monthly fixed costs / (net price - variable cost).
4. Capacity check: open minutes per day / (session length + cleaning time) x beds. If break-even needs most of that, the plan is fragile.

For packages, divide the net price by the sessions you expect members to use. The SBA's business plan guide shows where these figures go.

Step 8: choose software that enforces your rules

Software should make steps 3 to 6 impossible to skip at the desk: a time over the unit's maximum refused, no session without a signed statement and a date of birth, the tanning tax on its own receipt line, and a record of every session. The tanning salon software checklist lists what to ask any vendor to show you.

In TanVision, each room carries the maximum minutes you enter from its label, and a longer time is refused, not trimmed. Clients sign your consent form on their own phone, and each signed record keeps the exact wording. A UV session cannot start without a signed statement and a date of birth on file. Each package can carry its own excise rate beside its sales tax, and lamp hours are tracked per lamp group.

TanVision takes card payments and bills monthly memberships through its built-in card processing. With T-Max timer controllers, the desk sends each session's time to the bed's own timer, through a small box TanVision supplies; other timer brands are not supported yet. It does not keep an incident or timer-test log, or run more than one location today. See check-in, or book a demo to see it set up with your own rooms.