How to Start a Hair Extensions Business in Montana

Who regulates extension services in Montana

The licensing authority is the Board of Barbers and Cosmetologists, a board in the Business Standards Division of the Montana Department of Labor and Industry. The board administers Title 37, chapter 31 of the Montana Code Annotated, which licenses barbering, barbering nonchemical, cosmetology, electrology, esthetics and manicuring, plus premises and schools. Extension work is not one of the six; where an install lands depends on two definitions and one exemption in the chapter's first two sections. The board's fees are set by rule at ARM 24.121.401, as amended effective November 22, 2025: $100 for each practice license, $125 for the salon or shop license, $150 for the salon inspection, and $95 for a booth rental license. One warning: parts of the board's website, and an application checklist dated August 2024, still print the superseded $80 practice fee. Where a board web page and the adopted rule disagree, the rule governs, and this guide prints the rule.

The rest of the setup sits outside the board. The Secretary of State takes the LLC filings, the annual report and the assumed business name registrations. The Department of Revenue runs income tax and withholding and confirms that Montana has no general sales tax. Your city or county controls zoning and the building, and, in a designated resort community, the local resort tax. Chapter 31 also does not reach tattooing or permanent makeup, which the board leaves to the Department of Public Health and Human Services, so a studio adding a microblading chair adds a second regulator, covered in the Montana microblading guide.

Montana hair extensions at a glance

The license question: the cosmetologist license, and what sits outside it

Start with what chapter 31 does not say. The cosmetology definition at section 37-31-101(9) is work included in the terms hairdressing, manicuring, esthetics and beauty culture, done for the embellishment, cleanliness and beautification of the hair and body. The barbering definition at section 37-31-101(3) lists shaving or trimming a beard, cutting, styling, coloring or waving hair, straightening hair by chemicals, facial and scalp massage, and shampooing, bleaching and highlighting. Neither definition names weaving, extending or attaching hair, and no other licensed scope in the chapter does either. The licensed side of the trade is reached by exclusion: the installs the braiding definition leaves out are cosmetology practice, and the credential that carries them is the cosmetologist license.

That license is the full scope credential. Section 37-31-304 sets the qualifications: at least 18 years old, good moral character, a high school diploma or its equivalent, and 1,500 hours of cosmetology education in a licensed school, followed by the board's examinations, the National Interstate Council of State Boards of Cosmetology theory and practical exams. The fee is $100 for a two year term renewing March 1, and Montana requires no continuing education for cosmetologists. Two newer routes end at the same license: endorsement under section 37-31-304(1)(c), for an applicant licensed in a state whose hours equal or exceed Montana's with a current, undisciplined license, and the registered apprenticeship created by House Bill 336 in 2025, which trains an apprentice in a licensed salon under a mentor, registered through the state apprenticeship program, and ends at the same examinations.

The narrower licenses do not open a side door. The barber license takes 1,100 hours and the barber nonchemical license 900, but both rest on the barbering definition, a tonsorial scope that never names attaching hair, and the nonchemical license excludes chemicals outright, which removes bonded installs from it a second time. The esthetician license (650 hours) covers skin care and temporary hair removal, and the manicurist license (400 hours) covers nails; neither touches installation. There is no specialty to apply for: the six practices are the whole list, and weaving and extensions appear nowhere in the chapter as a credential. A studio whose menu crosses the braiding boundary staffs the licensed side with cosmetologists.

The braiding boundary: where unlicensed installs end

Montana deregulated natural hair braiding in 2023, and the deregulation reaches further into extensions than it does in most states, because the definition names the install itself. Section 37-31-101(17) defines natural hair braiding as the service of twisting, wrapping, weaving, extending, locking or braiding hair by hand or with mechanical devices. It expressly includes the use of natural or synthetic hair extensions and fibers, beads and accessories, the minor trimming of hair or extensions incidental to the braiding work, and the making of wigs. Topical agents are inside it too: conditioners, gels, moisturizers, oils, pomades and shampoos. Section 37-31-102(5) then provides that the chapter does not prohibit services by an individual who engages only in natural hair braiding. Read together, sew-ins on braided foundations and weaving or extending by hand or with mechanical devices, using extensions, are unlicensed services when braiding is genuinely the method. Our Montana braiding guide covers the exempt trade in full.

The exclusions at section 37-31-101(17)(c) are the boundary, and they are written in the industry's own vocabulary. Natural hair braiding does not include the application of dyes, reactive chemicals or other preparations to alter the color of the hair or to straighten, curl or alter the structure of the hair, and it does not include the use of chemical hair joining agents, such as synthetic tape, keratin bonds or fusion bonds. The definition closes by stating that natural hair braiding does not mean the practice of cosmetology. So the line is the joining agent and the chemistry, not the hair: tape-in installs and K-tip and fusion installs are licensed work however they are marketed, and so are the color service, the relaxer and the real haircut around an install. The trimming allowance survives only as the minor trim incidental to the braiding itself.

The word only does the remaining work. The exemption describes an individual who engages only in natural hair braiding, so it is personal and menu wide: the day a braider adds bonded installs or color, those services sit inside the chapter, performed by a licensee in licensed premises, while her braiding stays exempt beside them. The common Montana mistake is a braiding studio that drifts: braid anchored installs are exempt, clients ask for tape-ins, the studio adds them, and nobody notices the menu crossed into licensed practice. Plan the menu against the definition before you open, and staff any adhesive or chemical service with a cosmetologist from day one.

Your space: the salon or shop license, and the booth rental license

The space itself needs a license when licensed services are performed in it. Section 37-31-302 makes it unlawful to manage or operate a salon or shop without a license, and unlawful for an owner to employ an unlicensed person in any of the six practices. The premises license is the salon or shop license: the application carries the $125 license fee and the $150 inspection fee, and the board inspects licensed salons and shops annually under section 37-31-312. The license renews every July 1 at $125. Two life events reset it instead of renewing it: a move to a new location, and an ownership change of more than 50 percent, each require a new application, so sequence either months ahead. You do not need a practitioner license to own the salon; every person performing licensed services inside it must hold their own practice license covering that service.

Booth rent in Montana is a licensing category before it is a business arrangement. Under section 37-31-101, a booth is any part of a salon or shop rented for performing the licensed services, and section 37-31-302 makes it unlawful to operate one without a booth rental license. The license is the renter's own: $95 to apply and $95 to renew, on the annual July 1 premises calendar. The board's conditions define the model: the renter must hold a current Montana practice license in good standing, and must not be employed by the owner of the shop, as employment is defined in the unemployment statute at section 39-51-204(1)(e). That definition is effectively Montana's booth rent statute: it looks for a written acknowledgment that the licensee is not covered by unemployment insurance or workers' compensation, a contract, freedom from the owner's control, payment from her own clientele, and her own equipment, skills and knowledge. Build the written agreement around those elements from the first chair.

The braiding side of the studio follows the braiding logic. A studio whose entire menu is natural hair braiding as defined performs none of the chapter's licensed practices, so it needs no salon or shop license. The same logic reaches the booth rental license, which licenses a booth for the licensed services: braiding only work inside someone else's salon does not require one. The mixed studio is the normal case for extensions, and it licenses once: the room takes the salon or shop license for its bonded, color and chemical work, renters performing licensed services hold booth rental licenses, and the braiding menu runs exempt beside them. Our Montana salon suite guide walks the renter's side of the arrangement in full.

Forming your business: the LLC

Most Montana extensions studios form a limited liability company under the Montana Uniform Limited Liability Company Act, Title 35, chapter 8, so the studio's debts stay with the studio. Formation is a single filing: Articles of Organization submitted to the Secretary of State's Business Services division, online through the state's business filing portal, for $35. The articles name the company and its registered agent in Montana. The follow-on filings are cheap and rare: $15 to correct or amend the articles, $20 to merge, no fee at all to terminate, and a $5 certificate of existence when a landlord or lender asks for proof the company is on the register.

The annual obligation is the annual report, due April 15 each year. Read the Secretary of State's fee schedule carefully: the fee is waived when the report is filed by April 15, and $35 when it is filed after April 15. A company that lets its reports lapse entirely faces reinstatement at $35 plus $35 for each year of delinquent reports, on top of losing the good standing its lease, its bank and its salon license application assume. The report is short, and it keeps the entity's liability shield alive on the register. The full formation walkthrough is in our Montana hair salon LLC guide.

Registering your studio name

Montana calls a trade name an assumed business name, and registration runs through the Secretary of State rather than the county. Any person or entity doing business under a name other than its legal name registers that name under Title 30, chapter 13, part 2, for a $20 registration fee. The registration is effective for five years under section 30-13-206, and it renews for another five year term at the same $20, with notice from the Secretary of State before the term expires. Amending a registration costs $20, and canceling one is free. A name reservation is a different instrument: $10 holds a name while you organize, and it does not substitute for the registration once you are trading. The registration and the LLC run on separate clocks, so search the Secretary of State's business records before filing either one; a name that is not distinguishable from an existing record will be rejected.

Getting your EIN

The Employer Identification Number is the federal tax identity for the business, issued free by the IRS. A studio with employees needs one before the first payroll, because Montana withholding and unemployment reporting key off it, and most business bank accounts require one as well. Apply on the IRS site, keep the number with the LLC records, and keep the legal name identical across the EIN record, the Secretary of State filings and the salon license application.

Sales tax: the tax Montana does not have

Montana is one of the few states with no general sales tax, and the Department of Revenue says so in terms: its sales tax guidance states that Montana does not have a general sales tax. For an extensions studio the consequence is simple and total. There is no sales tax permit to obtain, no rate to program into the register, and no tax to collect on a sew-in, a bonded install or a bundle of hair off the retail shelf. Selling hair and clip-ins is likewise retail trade, not one of the six practices chapter 31 licenses, so the hair counter needs no board license either.

Three qualifications keep the picture honest. No sales tax is not no tax: profits are subject to Montana income tax, and employers register for withholding and unemployment insurance as the hiring section describes. Designated resort communities may levy a local resort tax on luxury goods and services under Title 7, chapter 6, part 15, so a resort town studio should confirm whether its retail sales sit inside that tax. And a studio shipping hair to customers in other states steps into those states' collection rules; Montana's exemption ends at the state line.

Hiring stylists: wages, unemployment and withholding

Montana's minimum wage is $10.85 an hour from January 1, 2026, set under the annual inflation adjustment in section 39-3-409 and recalculated every fall, so pay rates need a January check each year. Two features differ from most states. Montana allows no tip credit: a tipped stylist must be paid the full $10.85 an hour in wages, with tips on top. Commission stylists are employees when the studio controls their schedules, prices and clients; it is the booth rental license and the written contract, not a label in a handbook, that makes a chair independent in Montana.

Hiring triggers three registrations. The business registers with the Unemployment Insurance Division and pays contributions on the first $47,300 of each employee's wages in 2026. New employers are assigned their industry's average rate: for 2026, on Schedule I, the services rate for a new salon is 1.10 percent, plus the 0.18 percent Administrative Fund Tax every employer pays. The business also registers with the Department of Revenue for withholding, through the Montana Business Registration form or the TransAction Portal; each employee completes Form MW-4, and the year is reconciled on Form MW-3. New hires are reported to the Department of Labor and Industry within 20 days, and a studio with employees carries workers' compensation coverage through the Montana State Fund or a private insurer.

The local layer: cities, zoning and premises

The state licenses the studio; the city decides where it can be. Zoning approval for a personal services use, any local business license your city requires, building and signage permits, and occupancy and fire inspections run through the city or county where the premises sit. The one local tax that can reach a beauty business is the resort tax described in the sales tax section, and it exists only in designated resort communities and resort areas. Premises facts carry licensing consequences: the salon or shop license belongs to the location, so moving the studio or changing ownership by more than 50 percent requires a new application and a new inspection rather than an amendment. The residence rule in section 37-31-101 cuts both ways for home based practice: a room in a home used only for residents is outside the salon definition, but the moment it serves paying nonresident clients it must be licensed as a salon or shop when licensed services are performed there, with local home occupation zoning as the second gate. Braiding only work at home answers to the zoning code alone, because the licensing chapter does not reach it.

Insurance for a Montana extensions studio

Nothing in chapter 31 conditions the studio's licenses on carrying liability insurance, so coverage is a business judgment rather than a licensing step, with one exception: workers' compensation is an employment obligation, carried through the Montana State Fund or a private insurer. The standard voluntary stack is general liability for the premises, professional liability for the services each license covers, and property coverage for equipment and retail inventory. Owners using the booth rent model should require each renter to carry her own professional liability policy, because the licensing structure makes the renter a separate operator inside premises your name is on.

Extensions studios carry one inventory exposure most salons do not: the hair itself is expensive stock, held for specific clients and often prepaid, so name it on the property schedule. The deeper walkthrough is in our Montana hair salon insurance guide.

Renewal and filing calendar

The rhythm of a Montana extensions year is a March in which the people renew, an April entity report, and a July 1 on which every premises license in the building comes due at once.

Official sources

• Board of Barbers and Cosmetologists: the board's licensing pages, its announcement of the rule changes effective November 22, 2025, and the adopted fee rule at ARM 24.121.401.
• MCA 37-31-101: the chapter's definitions, including cosmetology, barbering, booth, salon or shop, and natural hair braiding at subsection (17).
• MCA 37-31-102: the exemption list, including subsection (5) for an individual who engages only in natural hair braiding.
• MCA 37-31-302: the license requirement for practicing, and for operating a salon, shop or booth.
• MCA 37-31-304: qualifications and training hours for each practice license, and endorsement without examination.
• Board of Barbers and Cosmetologists, Notice of Adoption, MAR Notice No. 2025-221: the ARM 24.121.401 fee amendments and the apprenticeship rules effective November 22, 2025, and the NIC examination position.
• Board of Barbers and Cosmetologists, booth rental license page: the $95 fee, the July 1 renewal and the conditions for the booth rental license.
• Secretary of State, Business Services filing fees: Articles of Organization at $35, the annual report terms, and assumed business name registration at $20.
• Department of Revenue, sales tax guidance: the department's statement that Montana does not have a general sales tax.
• Department of Labor and Industry, 2026 minimum wage determination: the $10.85 rate effective January 1, 2026 under MCA 39-3-409.
• Unemployment Insurance Division, contribution rates: the 2026 taxable wage base of $47,300 and the industry rates for new employers.
• IRS, apply for an EIN: the free federal application.

Montana hair extensions FAQ