3 Tax Tips for Lyft and Uber Drivers
As a ride share professional, your taxes were not deducted from your paychecks. This means that you will have to file your taxes as an independent contractor also known as independent business owner. So that it does not become overwhelming for you, here are the most important tips to better file your taxes and save on tax payments to the fullest.
You Won’t Receive a W2 Form
As an independent contractor also known as independent business owner, you will not receive a W2 Form from Lyft or Uber. Instead, you will receive a report showing your earnings and the name of this document will depend on how much money you made throughout the year 2018. Use any type of income report to file your taxes. It is necessary to report any income no matter the amount even if it is not a popular believe. The breakdown on what kind of form you will receive goes like this:
- If you earned more than $20,000 in gross ride payments and had more than 200 transactions, then you will most likely receive a 1099-K Form (Florida Based Information)
- If you earned at least $600 from non-driving earnings, you will most likely receive a 1099-MISC Form.
- No matter the amount, you will be able to get a full report of your annual earnings with Lyft or Uber in order to report and file your income taxes.
Deductions and Tax Breaks for Last and Uber Drivers
As you start listing deductions, it will be nice to see that Lyft and Uber already have provided you with the totals of some business expenses. These business expenses include Fees charged by Lyft or Uber, Tolls, and additional fees. This list will also include the Miles you drove while only which are deductible. Some other deductions that are beneficial to Lyft nd Uber drivers include any expenses derived from running your ride share business. Some expenses are gas, oil, maintenance, repairs, auto insurance and car payments. There are simpler options to claim vehicle deductions such as choosing to claim the Standard Mileage Deduction. This decision can be made by you with the help of a tax professional or tax software of your choosing. Also choose to deduct your mobile phone expenses since it was a main tool to work your business driving. Some expenses may include the cost of the phone, accessories such as phone holder, ny repairs and even your service plan. It will be important to claim only the part of the phone plan expense that you use for your business and not personal.
Other Deductions for Lyft and Uber Drivers
As listed on the Intuit Tax Tips website, a nice resource to also stay updated with tax topics… here are additional business expenses you can deduct:
- Snacks and refreshments for your passengers
- Electronic toll transponder
- First aid kits
- Portable battery jump pack
- Business taxes and licenses
- Roadside assistance plans
- Office supplies
- Tire inflator and pressure gauge
- Initial inspection expense
- Background check if you had to pay for it
- Other expenses can and should be discussed with your tax professional of choice.
I will be discussing up to 1000 deductions that can be used to save money on your income taxes. Visit my webinar page to register for the next DON’T MISS A SINGLE DEDUCTION LIVE WEBINAR with Q&A
Eneyvel Arias, Tax Professional