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Tax Time! Ask me anything about Ride-share Taxes

Older Chauffeur

Well-Known Member
Thanks for the input! I’m guessing the year end statement will only include my deposits, correct? So I write off mileage at the current rate against the deposits, and that’s all? I don’t pay for my cell phone (my other job provides my phone). What else can I reasonably write off? Thanks!
I don’t drive for U/L, but my understanding is that the gross amount that they show is what the riders paid, including all fees. You show that on your Schedule C and then deduct their fees to get your gross, and then deduct your mileage and other expenses. These include any extras you provide to riders like water. If you get more than the normal amount of car washes (say over once a week) to keep your car clean for clients, a case could be made for that deduction. Maybe @UberTaxPro will comment. I hijacked his thread. ? :p
 

SamuelB

Active Member
Some drivers are under the impression that if you are online with Uber and Lyft at the same time you get to claim double the miles because you have both apps on. So basically they are claiming $1.16/mile because they have both apps on. I disagree since having both apps on does not increase your expenses and there is no way the IRS is going to let you double dip. Schedule C asks for total business miles you drove. It doesn't care if it is Uber or Lyft and you can't drive the same mile twice.
What say you?
 

UberTaxPro

Well-Known Member
Past Sponsor
  • Thread Starter Thread Starter
  • #184
Some drivers are under the impression that if you are online with Uber and Lyft at the same time you get to claim double the miles because you have both apps on. So basically they are claiming $1.16/mile because they have both apps on. I disagree since having both apps on does not increase your expenses and there is no way the IRS is going to let you double dip. Schedule C asks for total business miles you drove. It doesn't care if it is Uber or Lyft and you can't drive the same mile twice.
What say you?
You're 100% correct. Don't double dip unless it's an ice cream cone! The IRS holds you responsible for your record keeping, not Uber or Lyft.
 

LD598

Member
Hey there UberTaxPro,

I have two questions for you if you’d be so kind as to indulge me.

1. How would you recommend I calculate the percentage of my cell phone bill to write off as a deduction? Since cell phone crevice isn’t something that’s inherently tied to the vehicle, using the percentage of rideshare miles/total miles driven doesn’t make sense to me. I also don’t imagine there’s an easy way to calculate the cellular data used while driving rideshare as compared to total data used overall. My inclination is to claim half of my annual bill as an expense, but am curious to hear what your take is on this.

2. Here in San Diego, the city requires rideshare drivers to pay for a business tax license every year. It’s horsesh*t, but it’s also another write off. However, coming into 2019, they were sending me notices that said I had to pay the fee for 2019 in full by January 1st. So, I incurred the expense in late December of 2018, even though the license was technically an expense for 2019. Can I still write this off as a 2019 expense or does the fact that I paid for it in late 2018 make that problematic?

Thanks much for your insight.
 

SamuelB

Active Member
1. How would you recommend I calculate the percentage of my cell phone bill to write off as a deduction? Since cell phone crevice isn’t something that’s inherently tied to the vehicle, using the percentage of rideshare miles/total miles driven doesn’t make sense to me. I also don’t imagine there’s an easy way to calculate the cellular data used while driving rideshare as compared to total data used overall. My inclination is to claim half of my annual bill as an expense, but am curious to hear what your take is on this.
I'm not a tax expert nor do I play one on TV. I do claim 75% of my phone. I have no personal life so any review of my calls/text will show the majority are business related. I also save a copy of my iPhone Screen Time report every week wich shows the amount of time spent on each app. My work related apps are always the most.
 

UberTaxPro

Well-Known Member
Past Sponsor
  • Thread Starter Thread Starter
  • #187
Hey there UberTaxPro,

I have two questions for you if you’d be so kind as to indulge me.

1. How would you recommend I calculate the percentage of my cell phone bill to write off as a deduction? Since cell phone crevice isn’t something that’s inherently tied to the vehicle, using the percentage of rideshare miles/total miles driven doesn’t make sense to me. I also don’t imagine there’s an easy way to calculate the cellular data used while driving rideshare as compared to total data used overall. My inclination is to claim half of my annual bill as an expense, but am curious to hear what your take is on this.

2. Here in San Diego, the city requires rideshare drivers to pay for a business tax license every year. It’s horsesh*t, but it’s also another write off. However, coming into 2019, they were sending me notices that said I had to pay the fee for 2019 in full by January 1st. So, I incurred the expense in late December of 2018, even though the license was technically an expense for 2019. Can I still write this off as a 2019 expense or does the fact that I paid for it in late 2018 make that problematic?

Thanks much for your insight.
Yes, you're correct there is no easy way to allocate cell phone bills. Pick a reasonable method stick with it consistently. Your 50% sounds reasonable as does @SamuelB method at 75% to me.

The business tax question depends: Did you deduct the expense in 2018? if yes you can't deduct again in 19.

It also depends on your accounting method which is a selection you make on your tax return. If you've selected accrual, then yes, you can deduct in 2019. If you selected cash, then no, you can't deduct in 2019.

With the cash method you can amend your 2018 return and take the deduction for 2018.
 

LD598

Member
Thanks for the feedback. I used the cash method in 2018 since that seems to be how both Lyft and Uber do their end of year accounting. I did not write this expense (2019 license) off in 2018, but I did write that year’s Business Tax license off, which was charged in January of 2018. Sounds like I’m SOL on this one since I paid the tab for 2019 in 2018 and use the cash method. Lesson learned. I’ll be sure to pay the fee for 2020 on January 1st, 2020.
 

Darrell Green Fan

Well-Known Member
So will the Uber app track miles even if you are outside of your territory where you can accept rides? In theory someone could drive to California and deduct all the miles even though they aren't really ride share driving.
 

NTXDFWDriver2017

Active Member
I went to H&R Block once years ago because I got tangled up in an OID and didn't know how to handle it from a tax perspective. Never again. The woman that I worked with there was clueless. After about 20 minutes, it became painfully clear to me that I understood this stuff better than she did. Lesson learned. The only time you go to H&R Block is if you have a very simple return that you can do yourself, and if that is the case, why go to H&R Block at all?
Dont go to hr and block for taxes they have no idea on how to file taxes as a rideshare driver!
 

MrLightRail

New Member
Post automatically merged:

Can I deduct miles from home to the first ride? Also between rides the mileage ? If so I will go back and add up all those miles. Also will keep track from here on. Is using UBER weekly sheet best for proof? Thanks in advance for any info. Retired but don't want to end up paying taxes I don't have to.
If you have your app on, and available for pickups, yes.I do this on the oft chance I'll get a rider on my way to my "hunting grounds".
 

simont23

Member
I have a question,
Uber is a second job for me.
Do I have to pay 32,5% tax plus GST of every trip that I receive? Or the GST will be deducted from the 32.5^ of tax?
Thank you
That's exactly how Uber survives. Relying on people who are unable to work out obvious stuff.
 

FLKeys

Well-Known Member
It's my understanding that the first ride out and the ride back home is NOT deductible as the IRS considers that a commute.
When it comes to some one like a traveling nurse or salesman than yes these are commute miles. If you do rideshare in one particular area away from where you live one could argue that you have commute miles. However if you are sitting at home with the app on and accept a trip and drive to it I think you could argue you were actively looking for or doing work and those miles are not commute miles.

In my case I have a day job. When I am done there I turn on the app and run trips to where ever they take me. As things slow down I make my way toward home with the app still running and still actively looking for rides. To me these are not commute miles as I am still looking for work. When I get home I leave the app on and am still actively looking for work for at least an hour if not more. So I am still not commuting at that point. Also I maintain a desk and work space at home to keep all my records up to date daily when I get home, so in theory I am still working and not commuting.

When I leave my house on my way to work I do turn on the app in destination mode to my place of employment. I do consider these commute miles and do not record them as an expense. If I do get a ride I will record the miles from the time I accepted the ride until I dropped off the PAX as business miles. The remaining miles to work are than considered commute miles.

I may be able to include all the morning miles as business miles since I am technically looking for work but I don't as I feel it is outside the spirit of the commute/business miles standard.

My thinking may be wrong
 

Darrell Green Fan

Well-Known Member
When it comes to some one like a traveling nurse or salesman than yes these are commute miles. If you do rideshare in one particular area away from where you live one could argue that you have commute miles. However if you are sitting at home with the app on and accept a trip and drive to it I think you could argue you were actively looking for or doing work and those miles are not commute miles.

In my case I have a day job. When I am done there I turn on the app and run trips to where ever they take me. As things slow down I make my way toward home with the app still running and still actively looking for rides. To me these are not commute miles as I am still looking for work. When I get home I leave the app on and am still actively looking for work for at least an hour if not more. So I am still not commuting at that point. Also I maintain a desk and work space at home to keep all my records up to date daily when I get home, so in theory I am still working and not commuting.

When I leave my house on my way to work I do turn on the app in destination mode to my place of employment. I do consider these commute miles and do not record them as an expense. If I do get a ride I will record the miles from the time I accepted the ride until I dropped off the PAX as business miles. The remaining miles to work are than considered commute miles.

I may be able to include all the morning miles as business miles since I am technically looking for work but I don't as I feel it is outside the spirit of the commute/business miles standard.

My thinking may be wrong
No your thinking is logical. Problem is IRS auditors tend to be pretty black and white. And since they are judge and jury and their word is final why take the chance? I think I'll play it safe and not claim those miles in case I get a hard ass auditor. When I file I just want to know I won't have issues down the road, the piece of mind is worth the extra few dollars in tax savings, so I tend to play it safer than most.
 

kcchiefsfan1982

Well-Known Member
Someone told me that when tracking miles, I cannot simply just track the amount from when I started while on the clock to when I finished...but for each destination, I have to have the start & stop address...in other words, my daily log of miles would be 12 lines if I did 12 trips instead of just (1) line on the excel spreadsheet.

Is this true? If so...ughh!!
 

NotanEmployee

Well-Known Member
Backtracking a bit on mileage-

1. I live about 20 miles away from the biggest city in my market. I mostly turn the app on when I leave the house but head in that direction until I get a ride and deduct these miles. What if I drive from home with the app off, but with the intent to better position myself for business? Like it is Saturday night downtown or there is a concert and I want to make sure I’m closer when it lets out. Would you consider these deductible or commuting?
2. When I’m done for the night I will often turn off the app to go home. It is mostly for safety as I get tired or I’m uncomfortable driving after a certain hour. Sometimes I’m 10 miles from home and other times I’m 30 miles. Would you consider all of these commuting miles no matter how far I away I am?
3. Does having a home office (and taking the deduction for it) impact the answer to either of the above questions?
4. What about when I drop off a passenger in a neighboring town and then drive back toward my normal area with the app off? I will often drive at least part of the way back with the app off either because I’m very unfamiliar with the area or I believe my normal area is more profitable. I hate not having Uber destination mode.
5. I drive a car that is titled in my husbands name only. We file jointly and things like insurance are joint. Any issues with me deducting miles?

Thank you!!
i would never claim miles with the app off. if the app is off you are not working. it would be commuting. the IRS doesnt care how well intentioned you are. either dont count those miles or find a way to game the system. i use DF and will do select only to reduce chances....but if i get a ping ill take it. if i really dont want a ping i turn it off and end tracking miles.
Post automatically merged:

Someone told me that when tracking miles, I cannot simply just track the amount from when I started while on the clock to when I finished...but for each destination, I have to have the start & stop address...in other words, my daily log of miles would be 12 lines if I did 12 trips instead of just (1) line on the excel spreadsheet.

Is this true? If so...ughh!!
this is true for destination travel. from point A to point B. but they allow route miles which is what uber is. a route would be from the moment you turn the app on until you turn it off. for me the start and end address is my house.
 

kcchiefsfan1982

Well-Known Member
this is true for destination travel. from point A to point B. but they allow route miles which is what uber is. a route would be from the moment you turn the app on until you turn it off. for me the start and end address is my house.
[/QUOTE]

Ok, thank goodness! Some guy on this forum was telling me that the IRS will not accept just putting start to finish route...but that I had to do a line item for every single drive! I did not want to have to track it that detailed!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

Thanks!
 
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