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How to report Uber earnings while collecting unemployment?

Discussion in 'Pay' started by renbutler, Aug 31, 2015.

  1. renbutler

    renbutler Well-Known Member

    Location:
    Indy North Suburbs
    Driving:
    UberXL
    I was laid off in July, and I have been driving Uber for extra cash while also looking for a new job and collecting severance.

    My last severance paycheck will be coming in a couple weeks, and then I will be eligible for unemployment (if, God forbid, I haven't landed full-time work by then).

    I fully intend to comply by all legal rules while filing for unemployment, so I understand that I have to report all part-time and self-employment income each week that I file. I also understand that this would likely reduce my unemployment benefit.

    But here's the question: If I am legally self-employed with Uber while filing for unemployment, do I report my GROSS income from Uber, or my NET income after deducting expenses? And would I deduct actual expenses, or the much larger standard mileage discount?

    (My state's unemployment web site does an extremely poor job of addressing this, and the phone number is voice-prompt hell.)

    I'm hoping for answers from somebody with real-world experience about this. I understand that each state might have different rules, but any information would be welcome.
     
    SelectRangeRover and chi1cabby like this.
  2. Disgusted Driver

    Disgusted Driver Well-Known Member

    Location:
    Raleigh
    Driving:
    UberSELECT
    I don't have direct experience with unemployment but there's no doubt that for income verification etc... the only number relevant is the net. Gross - .57 a mile driven whether empty or not is your actual income.

    P.S. I applaud your integrity.
     
    gokittygo, Uberon1986, Stygge and 3 others like this.
  3. chi1cabby

    chi1cabby Well-Known Member

    Location:
    Chicago
    Driving:
    UberTAXI
    george_lol, tootsie and ReviTULize like this.
  4. renbutler

    renbutler Well-Known Member

    Location:
    Indy North Suburbs
    Driving:
    UberXL
    Thanks for the replies.

    I know that if I got a regular part-time job (such as in retail), I would have to report gross (pre-tax) income. It just seems that self-employment would be a little different because of all the expenses associated with it.

    That said, if I use the standard mileage deduction, I wouldn't have to report any income at all because it results in a loss (for tax purposes). It seems like actual estimated net would more accurately apply to the entire point of getting unemployment.
     
    ReviTULize and chi1cabby like this.
  5. SCdave

    SCdave Well-Known Member

    Location:
    LA / OC
    Driving:
    UberX
    It would be great if you could get the assistance of a local (for you) Non Profit that could provide a professional (like a CPA) who would produce the Net Income figures for you.

    This would help not only yourself but many many others. And not only in your home state but nationwide. I know this would be more work for you, but it would be great work.

    Good luck and keep us informed.

    Maybe you could contact your local CPA Association. Or maybe this journal and let them know what your goals are. Then see if they might help you to figure out your actual Net Income as an Uber Driver. Benefits for a CPA or the Accounting Journal? CPAs/Accounts are going to see more 1099 OnDemand clients going forward so it is very relevant for a great article.

    http://www.journalofaccountancy.com/issues/1999/nov/shaferl.html

    FOR THE PUBLIC GOOD


    "CPAs have numerous opportunities to make a difference in their communities. Many provide pro bono accounting services through not-for-profit groups such as Accountants for the Public Interest (API). API has 21 affiliate organizations nationwide that coordinate pro bono efforts by matching volunteer accountants with individuals and organizations that need their expertise. The volunteers come from all sectors of the accounting profession, including public accounting firms, private industry, government and educational institutions. Although the services offered through API affiliates vary widely, they commonly include consulting on accounting and auditing matters and providing accounting or income tax assistance and help in preparing for audits. Services are offered only to qualifying organizations, such as small not-for-profit organizations or businesses that cannot afford to pay for them, and individuals, such as poor, elderly and disabled taxpayers"
     
    thomas1234 and chi1cabby like this.

  6. renbutler

    renbutler Well-Known Member

    Location:
    Indy North Suburbs
    Driving:
    UberXL
    Thanks, but my issue isn't really about how to determine my net income. I know how to do that.

    My only question is which number (gross/net taxable income/actual net) the unemployment bureau expects me to report.
     
  7. Txchick

    Txchick Moderator Moderator

    Location:
    Dallas TX
    Actual net after Ubers fee & SRF.
     
  8. cybertec69

    cybertec69 Well-Known Member

    This is how it works, when you do your taxes, you will receive a 1099 from uber with your total gross income "what they deposited into yourbank account" including the uber free, you will have two options "you can choose only one or the other" not both " for deductions, expenses such as insurance, registration costs, tolls, phone costs, wear and tear, gas, pretty much anything associated with operating the car as a Taxi, it will also ask you what type of car and year, and your second option is the mileage ", last year I chose the mileage" fudged the numbers a little bit ", it exceeded my overhead costs, not by much. Now you will add ALL the income from uber including their fees" what it says on the 1099k form they send you" into the first line item, then there will be another line item for commissions paid "which is the uber cut", you are not held liable for that amount, uber is.
    Example :
    1099 total income is 10,000
    Uber fee 28%=2,800
    Total =7,200 "this is the number you will be held tax liable for.
    The reason Uber does this is because, they also send this information to the Fed, which means you can not fudge the uber cut they withhold from you, since they are also liable to pay taxes on.
    So if you did 10,000 miles you are able to write off $5700 of that $7200, which means you are liable to pay taxes for the $1500 that is left at a 35% tax rate.
     
    Last edited: Aug 31, 2015
    george_lol likes this.
  9. SCdave

    SCdave Well-Known Member

    Location:
    LA / OC
    Driving:
    UberX
    No problem, just thought maybe a CPA might be a better source than some of us on this Forum. Especially since you will be filing for unemployment.
     
  10. renbutler

    renbutler Well-Known Member

    Location:
    Indy North Suburbs
    Driving:
    UberXL
    Thanks, but my question has nothing to do with figuring out taxes.

    I know all of that stuff, but year-end calculations do me no good if I need to file for unemployment in a couple weeks.
     
    thomas1234 and chi1cabby like this.
  11. renbutler

    renbutler Well-Known Member

    Location:
    Indy North Suburbs
    Driving:
    UberXL
    Right, I'm not looking for professional advice necessarily. I was looking for guidance if anybody here had real-world experience.
     
  12. Disgusted Driver

    Disgusted Driver Well-Known Member

    Location:
    Raleigh
    Driving:
    UberSELECT
    Again, I'm going to argue that it's after you deduct your mileage expenses. If that's zero or less than you have no income, it's essentially a hobby. Using a hypothetical: You make 1000.00 one week, after the Uber cut. You drove 1000 miles to do so resulting in a 570.00 mileage deduction. Your pretax earnings (just like working) is $430, that's what you would declare. If it's zero, you are done. With your head held up high you can say that you made nothing from your Uber activities, nothing more to it. You do not have income if your expenses are greater than your payment.
     
  13. renbutler

    renbutler Well-Known Member

    Location:
    Indy North Suburbs
    Driving:
    UberXL
    I understand that, but the question remains whether it should be based on taxable income calculations, or real-world profits (which are very different numbers). That's why I'm hoping that somebody who has discussed this with a CPA has any advice based on personal experience in their state.
     
  14. cybertec69

    cybertec69 Well-Known Member

    Exactly what profits are we talking about, with Uber there is none.
     
    Dredrummond likes this.
  15. renbutler

    renbutler Well-Known Member

    Location:
    Indy North Suburbs
    Driving:
    UberXL
    Well, that certainly adds nothing to the convo.

    I've made a profit using real-world numbers, and I have a loss using the standard mileage deduction. That's the question: which one to use, legally.

    There are plenty of threads for sniping at Uber. Instead, this is a thread intended for sharing useful information.
     
    thomas1234 and tootsie like this.
  16. chi1cabby

    chi1cabby Well-Known Member

    Location:
    Chicago
    Driving:
    UberTAXI
    Income calculation using the IRS¢57.5/Mile Standard Deduction for use of a car for business purpose is legal. Use that method if you have a detailed mileage log of your Uber driving.
     
  17. zombieguy

    zombieguy Well-Known Member

    Location:
    Jersey Shore
    Its always the gross, you always report the gross whether its taxes or unemployment. At your job lets say you made a $1000 a week but you had money deducted for medical and a 401K. When you contact unemployment you don't tell them well I make $1000 a week and get $100 deducted for this and another $100 deducted for that, you tell them your gross amount before taxes or nay deductions. Reporting Uber works the same way.
     
    Ang123 likes this.
  18. Disgusted Driver

    Disgusted Driver Well-Known Member

    Location:
    Raleigh
    Driving:
    UberSELECT
    With all due respect, I don't think so, here's why. At your job as an employee, you do not typically have reimbursed expenses. If you use your own car, they pay you. If you use your own tools they pay you, .... This is not a job, different rules apply. The deductions that you are talking about are elective so of course they wouldn't count, you are just choosing how to spend the money you earned.
     
    SelectRangeRover likes this.
  19. renbutler

    renbutler Well-Known Member

    Location:
    Indy North Suburbs
    Driving:
    UberXL
    I agree with DD on this. With medical insurance and 401(k), you are essentially electing to spend that money, and you are immediately getting a quantifiable service in return.

    With Uber's commission, I never had that money. I never would have received that money no matter what, and I never had a choice about what to do with it. (I know that taxes are similar, but you never know until next year whether you paid too much or too little, and by then it's probably too late to adjust the unemployment benefit.)

    The only thing I can think of associated with a regular job that I would exclude would be something like a mandatory uniform fee, if that were deducted from a check. There might be other similar examples.
     
  20. renbutler

    renbutler Well-Known Member

    Location:
    Indy North Suburbs
    Driving:
    UberXL
    It is my intention to follow the rules to the letter.

    It is my responsibility to report income every week that I file for benefits, and that includes anything that Uber paid me. This means I report the week I'm paid, not the week I work.

    If I have a good week of income (Uber or otherwise), I'll simply tell the state that I am not filing that week, and then I would not lose any weeks of eligibility.

    The only question that still remains is whether I report the gross (unlikely), the taxable income (possibly, although it will be moot as this number is negative), or the actual profit (seems mostly likely).
     

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