How to Calculate the Tanning Tax
The tanning tax calculation is one multiplication: the amount paid for UV tanning times 10%. A $25 session has $2.50 of tax. The arithmetic only gets harder when the price already includes the tax, when tanning sits in a bundle, or when you need to add up a whole quarter. This guide works through each case in dollars. All the businesses and amounts below are made up. For a quick estimate, use the tanning tax calculator.
The three formulas you need
| Situation | Formula | On a sample sale |
|---|---|---|
| Tax added on top of the price | Price x 10% | $15.00 x 10% = $1.50 |
| Tax included in the amount paid, not separately stated | Amount paid x 10% / 110% | $15.00 x 10% / 110% = $1.36 |
| Tanning bundled with other goods or services | Amount paid x (tanning charge / total of stand-alone charges) x 10% | See the bundle example below |
The first two samples come directly from Example 1 in the IRS regulation, section 49.5000B-1. The same $15 gives two different tax figures, depending on how it's presented. If the tax isn't separately stated, the regulation presumes the amount paid includes it.
A full quarter's tanning tax, line by line
Here's a salon that adds the tax at the register, for October to December. Each row is what customers paid before tax.
| Sale type | Count and price | Taxable amount | Tax at 10% |
|---|---|---|---|
| Single sessions | 900 x $15 | $13,500 | $1,350.00 |
| Monthly unlimited memberships | 120 members x $40 x 3 months | $14,400 | $1,440.00 |
| Membership join fees | 30 x $25 | $750 | $75.00 |
| Membership freeze fees | 20 x $10 | $200 | $20.00 |
| Free-session coupons, no purchase needed | 60 x $0 | $0 | $0.00 |
| Lotion, separately charged at market value | $3,000 in sales | Excluded | $0.00 |
| Total | $28,850 | $2,885.00 |
The join and freeze fees are in because the regulation treats them as amounts paid for tanning services. The coupons are out because nothing was paid. Lotion is out because it meets the test for separately charged other goods. In a real quarter, your own register totals replace these figures.
Moving the number onto Form 720
Tanning is a Part II tax, so if tanning is the salon's only excise tax, the return is short.
| Form 720 line | Entry |
|---|---|
| IRS No. 140, Indoor tanning services | $2,885.00 |
| Line 1, Part I total | No Part I tax |
| Line 2, Part II total | $2,885.00 |
| Line 3, Total tax | $2,885.00 |
| Line 5, Deposits made for the quarter | None. Pub. 510 says the collector isn't required to make semimonthly deposits. |
| Line 10, Balance due | $2,885.00 |
| Schedule A | Not needed for Part II taxes |
The form asks you to pay the full balance with the return. For this October to December quarter in 2026, the return is due Monday, February 1, 2027, because January 31, 2027 is a Sunday.
If your prices already include the tax
Some salons advertise one flat price. Take 200 sessions at $22, tax included and not separately stated.
- Total received: 200 x $22 = $4,400.
- Tax: $4,400 x 10 / 110 = $400.00.
- Salon keeps: $4,400 - $400 = $4,000 for the service.
A common error is to take 10% of $4,400 and report $440, which overstates the tax by $40. The opposite mistake is ignoring the tax because you never charged it. Here's that case.
You forgot to charge tax. A new salon took in $1,100 of tanning payments in its first quarter and never mentioned tax. The instructions say the collector is liable if the tax isn't collected for any reason. Since the tax wasn't separately stated, the amount paid is presumed to include it, so $1,100 x 10 / 110 = $100.00 goes on the line for IRS No. 140.
Bundles, discounts, and gift cards
Bundle. A package is $200 before tax. It includes tanning that sells alone for $50 and other services that sell alone for $200.
- Stand-alone total: $50 + $200 = $250.
- Tanning portion: $200 x ($50 / $250) = $40.00.
- Tax: $40.00 x 10% = $4.00.
The full bundle rules, including when you can skip this formula, are in our post on tanning tax on bundled packages.
| Event | What gets taxed | Tax |
|---|---|---|
| Half-price session, $7.50 paid | The $7.50 actually paid | $0.75 |
| Four tans at $15, fifth "free" | The $60 paid for the four | $6.00 |
| Free tan from redeeming loyalty points | Nothing. Redemption isn't a payment for tanning. | $0.00 |
| $100 gift card sold in December | Nothing at sale, if it can be used for other services | $0.00 |
| That card redeemed for a $15 session in January | The $15, in the January to March quarter | $1.50 |
| Tanning paid for by insurance, $40 | The $40. Amounts paid by insurance are included. | $4.00 |
From your total to a filed return
The figure that matters is your quarter's tax. Pull it from your register by the rows above, and keep the supporting records for at least 4 years. EasyFile720 then takes it from there: you report IRS No. 140 on Form 720 in a guided filing, the rate is built in, and the math is calculated after you enter your figures. Validations catch common mistakes before you submit.
You can create a free account, with no credit card needed to start, and pay when you file at $39.95 per filing. Salons filing every quarter can compare that with the Full Year Plan on the pricing page. If you want the bigger picture before filing, the indoor tanning tax guide covers who owes the tax and what's included.
FAQ
Do I enter my sales or my tax on Form 720?▼
Your tax. The instructions say to enter the amount of indoor tanning services tax collected, or due for failing to collect it, for the quarter on the line for IRS No. 140.
Which quarter does a prepaid package belong to?▼
The quarter of payment, because the regulation imposes the tax at the time of payment. A gift card that can be used for other things is different, since its tax arises when it is redeemed for tanning.
Do I round each sale or just the total?▼
The IRS sources do not give a rounding method for this tax. The regulation examples simply show amounts to the cent, such as $1.36. Apply one approach consistently and keep the records behind it.
Does the tax reduce what I report in a quarter with refunds?▼
The sources we reviewed do not walk through customer refunds for this tax. Adjustments to prior-quarter liabilities go on Form 720-X, so check with a tax professional if a refund crosses quarters.
File the indoor tanning tax online
Create a free account with no credit card and build your return. You pay $39.95 only when you file. EasyFile720 is an IRS-authorized e-file provider, and you get an acknowledgment when the IRS accepts your return.
Sources: Regulations section 49.5000B-1, T.D. 9621, 2013-28 I.R.B.; Form 720 (Rev. June 2026); Instructions for Form 720 (Rev. June 2026); Pub. 510 (Rev. December 2025). General information, not tax advice. Confirm how the rules apply to you with a qualified advisor or the IRS.
