Milady Esthetics State Board Practice Test

If you work under a booth rental agreement, you pay?

1. Your employer a salary

2. All taxes associated with being self-employed

3. A flat monthly fee

4. Commission on services

The correct answer is: All taxes associated with being self-employed

When working under a booth rental agreement, the arrangement typically involves you operating as an independent contractor rather than an employee. In this context, you would be responsible for all taxes associated with being self-employed. This includes income tax, self-employment tax, and any other applicable local or state taxes based on your earnings. Being self-employed in a booth rental situation means that you manage your own business expenses, including the taxes that come with your earnings. Although you may also have costs related to the rental itself and potentially other fees, the primary responsibility for paying taxes falls on you as the individual operating under the rental agreement. The other options hint at more traditional employment structures where an employer provides a salary or takes a commission, but in a booth rental scenario, you maintain greater financial autonomy and responsibility.