# Please Explain Uber Tax SRF?



## UberRidiculous (May 19, 2015)

Ok so any tax pros, UberTaxPro and friends, here's my question:
Since we know that Uber is now sending drivers a 1099 showing the driver received the SRF as income, if the driver does not send Uber a 1099 back for that fee (which is not necessary under $600 right?) then isn't this some kind of tax fraud?
I'm not an accountant but here's what it looks like to me:
1. Uber collects $500,000 in SRF
2. Uber pretends it gave $500,000 SRF back to drivers as income on their 1099s
3. Uber spends $100,000 on SRF kinda stuff.
4. Uber drivers only 1099 Uber for $30,000 of SRFs because most drivers don't know better or it's under $600.

So on paper it looks like a loss when it is not.
Uber +$530,000
Uber -$600,000
********************
But really should be:
Uber +$500,000
Uber -$100,000
********************
What am I missing?


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## UberRidiculous (May 19, 2015)

Hmmmm okay working through this in my head (I know I know) and I think it's okay as long as Uber subtracts the $500,000 SRF from any other SRF expenses they want to subtract or count on taxes. Because no one is allowed to double dip. So then 2 questions remain:
1. Why would Uber want to pretend drivers received that SRF money by putting it driver's 1099s?
2. Or is the answer simpler because the answer is yes they're trying to double dip on expenses?
or 3 questions
3. Or is this part of the IC v Employee camouflage techniques?


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## Another Uber Driver (May 27, 2015)

I send all of my 1099s to my tax accountant. I receive several every year as I have two Uber accounts, two credit card processors, and I get a few others from other sources. By now, my accountant is familiar with what Uber does. He did not tell me to send Uber a 1099, nor did he tell me that he was sending a 1099 to Uber. These accountants are pretty good. Had I an obligation to send anything to Uber, or to anyone, for that matter, I would expect that my accountant would have told me or done it for me.


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## UberTaxPro (Oct 3, 2014)

UberRidiculous said:


> Ok so any tax pros, UberTaxPro and friends, here's my question:
> Since we know that Uber is now sending drivers a 1099 showing the driver received the SRF as income, if the driver does not send Uber a 1099 back for that fee (which is not necessary under $600 right?) then isn't this some kind of tax fraud?
> I'm not an accountant but here's what it looks like to me:
> 1. Uber collects $500,000 in SRF
> ...


I can see it now... a CNBC American Greed 2 hour special about Uber Tax Fraud! Well anything is possible but I really doubt Uber would risk such a blatant tax fraud involving such a large amount of $.
They're getting ready to go public with an IPO coming out soon so why would they risk fraudulent activity? To prepare for the IPO independent CPA's have to audit and certify their books. Travis and investors have more to make with the IPO then by trying to steal a $1 a ride from the drivers. Just doesn't make sense.

With regard to # 2 on your list... It would only be pretending if they don't show the SRF in an income account on their books. Unfortunately we can't see their books to confirm but the IRS can whenever they want! I believe they are just trying to show that the driver collected the $1 from the pax first. I would guess they have a separate SRF income account that includes every $1 collected. When they go public their financials will be more transparent.

With regard to # 4 on your list.... Taxpayers (including Uber) are responsible for reporting all their income whether they get a 1099 or not. Even if 0 drivers sent 1099's Uber would still have to declare the $500,000 in your example as income.

Uber is on the verge of paying off the investors big time when they go public very soon. Tax fraud issues are the last thing they would want right now. It's kinda like .... Would you rob a bank the week before you're gonna inherit a couple million dollars?
Also, If you and I can see the potential for fraud in the system....the IRS can also!


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## UberTaxPro (Oct 3, 2014)

Another Uber Driver said:


> I send all of my 1099s to my tax accountant. I receive several every year as I have two Uber accounts, two credit card processors, and I get a few others from other sources. By now, my accountant is familiar with what Uber does. He did not tell me to send Uber a 1099, nor did he tell me that he was sending a 1099 to Uber. These accountants are pretty good. Had I an obligation to send anything to Uber, or to anyone, for that matter, I would expect that my accountant would have told me or done it for me.


Did you do more than 600 trips?


UberRidiculous said:


> Hmmmm okay working through this in my head (I know I know) and I think it's okay as long as Uber subtracts the $500,000 SRF from any other SRF expenses they want to subtract or count on taxes. Because no one is allowed to double dip. So then 2 questions remain:
> 1. Why would Uber want to pretend drivers received that SRF money by putting it driver's 1099s?
> 2. Or is the answer simpler because the answer is yes they're trying to double dip on expenses?
> or 3 questions
> 3. Or is this part of the IC v Employee camouflage techniques?


They just want to show that the driver got the money first, before they took it


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## UberRidiculous (May 19, 2015)

UberTaxPro said:


> I can see it now... a CNBC American Greed 2 hour special about Uber Tax Fraud! Well anything is possible but I really doubt Uber would risk such a blatant tax fraud involving such a large amount of $.
> They're getting ready to go public with an IPO coming out soon so why would they risk fraudulent activity? To prepare for the IPO independent CPA's have to audit and certify their books. Travis and investors have more to make with the IPO then by trying to steal a $1 a ride from the drivers. Just doesn't make sense.
> 
> With regard to # 2 on your list... It would only be pretending if they don't show the SRF in an income account on their books. Unfortunately we can't see their books to confirm but the IRS can whenever they want! I believe they are just trying to show that the driver collected the $1 from the pax first. I would guess they have a separate SRF income account that includes every $1 collected. When they go public their financials will be more transparent.
> ...


Awesome thanks!


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## Another Uber Driver (May 27, 2015)

UberTaxPro said:


> Did you do more than 600 trips?


I am not sure, but I doubt it. I went to look for my tax information, but it was not where I thought that it was. My accountant has the copies, anyhow, so I could get them if I had to. I signed on July, 2014 and went pretty quickly to "only enough to stay in the game" UberX-ing, especially after the Labour Day pay cuts here. I am a _very_ part time cab driver, as it is, thus I am an even more part time UberX-er, although I suspended my UberXing two weeks past until I can purchase some proper insurance here.


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## UberTaxPro (Oct 3, 2014)

Another Uber Driver said:


> I am not sure, but I doubt it. I went to look for my tax information, but it was not where I thought that it was. My accountant has the copies, anyhow, so I could get them if I had to. I signed on July, 2014 and went pretty quickly to "only enough to stay in the game" UberX-ing, especially after the Labour Day pay cuts here. I am a _very_ part time cab driver, as it is, thus I am an even more part time UberX-er, although I suspended my UberXing two weeks past until I can purchase some proper insurance here.


You probably did less than 600 but UberRidiculous is correct I believe, we should be sending Uber a 1099 for any payments to them $600 or over. (including SRF fees)


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## Another Uber Driver (May 27, 2015)

UberTaxPro said:


> we should be sending Uber a 1099 for any payments to them $600 or over. (including SRF fees)


Even if Uber collected the gross, took its and remitted the difference to us, we would still send a 1099? Please understand: this is a question, only. I am asking it to become informed, as I am woefully lacking in my knowledge of accounting and tax laws and procedures.

.....and I would be correct in assuming that if my accountant is of the calibre that I consider him to be, he would let me know to send it, or, he would send it on my behalf and inform me that he did so?

I am trying to learn, here. I am assuming from your ID, that you know your subject and that you would be the guy to ask on this forum.


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## UberRidiculous (May 19, 2015)

Another Uber Driver said:


> Even if Uber collected the gross, took its and remitted the difference to us, we would still send a 1099? Please understand: this is a question, only. I am asking it to become informed, as I am woefully lacking in my knowledge of accounting and tax laws and procedures.
> 
> .....and I would be correct in assuming that if my accountant is of the calibre that I consider him to be, he would let me know to send it, or, he would send it on my behalf and inform me that he did so?
> 
> I am trying to learn, here. I am assuming from your ID, that you know your subject and that you would be the guy to ask on this forum.


Your accountant doesn't have ESP tho. So if your Uber 1099 doesn't show the SRF being given back to Uber, which I don't believe it does, and if you don't tell your accountant that the amount reported on your 1099 included SRF fees you never received, then your accountant has no way of knowing.

Also I wonder if airport fees that drivers never see are added to driver's 1099 like the SRFs?
chi1cabby do you know?


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## Another Uber Driver (May 27, 2015)

I did tell my accountant that Uber charges a "safe ride fee" and takes twenty per-cent. I faxed him a few copies of my payment statements as examples and informed him that I had every one, if he needed them.


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## UberRidiculous (May 19, 2015)

Another Uber Driver said:


> I did tell my accountant that Uber charges a "safe ride fee" and takes twenty per-cent. I faxed him a few copies of my payment statements as examples and informed him that I had every one, if he needed them.


That's good.  And I know you know what I know, which is there are a lot of Uber drivers who don't know! They won't check deposits against their 1099 and some will be clueless there is any difference at all. Then some who do know there's a difference won't hire a pro to make sure it's done properly.


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## Fat Jack (Jul 5, 2015)

Here's an unrelated tax question.

If my full time job is 20 miles from my home and I turn on uber/lyft on my way home looking for a fare, even if I don't get one before reaching home can I still count those miles as an expense on my tax return?


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## Another Uber Driver (May 27, 2015)

......and they can write off what they pay to the accountant to prepare their taxes. Self-employed and Schedule C filers might as well include a page with their return in day-glo yellow with bright red letters that reads *PLEASE AUDIT ME*. Since accountants now must file electronically, perhaps that eliminates said page. Still, I pay for everything for the UberXmobile and cab with a credit card, if I can. In cases where I must pay cash, I do keep the receipt. Cash or credit card, I staple the receipt to my trip sheet every day for the cab. In addition, I put the credit card statements for the two cards that I use only for the cab or UberXmobile, as well as my bank statements in the monthly folders that I have. I write daily, categorised, running totals on the trip sheet of income and expenses. At the end of the month, I add the monthly total to the running totals for the year-to-date. I keep track of the mileage on and off duty, as well, daily and running totals. Thus, upon conclusion of New Year's Eve operations, all that I need do is add that day to December 30th's running totals for the month, add December's final totals to the previous eleven months and I am ready to tell my accountant what I made, what I spent and how many miles I operated on and off.

I do it a bit differently for UberX. I have a notebook in which I note date, beginning mileage and ending for the day. If there are gaps, I note the total mileage off duty. Thus I keep track of mileage on and off. I keep my receipts in an envelope. I add the running totals of gross and net for each day worked. Every once in a while, I do add up all the receipts that I have saved, and add them to the previous running total, but I do not do this with any regularity until December. I am more diligent in December, as I do want to have the least amount of work possible for early January. Doing this requires a few extra minutes of work at the end of the day, but the time and headache avoided in the next year makes it worth the trouble.

I have two credit cards, one gasolene and one major, that I use only for the cab and UberX. This allows me to deduct interest, if I must carry a balance, which is something that I avoid. There was a time when new regulations dumped more than a few undue and unnecessary burdens on us. At the same time, GF had some medical problems, so my having to take her to the doctors and for tests severely curtailed my working hours. This caused me to carry a balance to pay for the newly mandated equipment. I did pay it off quickly, but the accountant told me that because I used those cards exclusively for the business vehicles, I could deduct the interest. He did check to see that I had the statements, which I told him I did, so that I could prove a lack of non-business use fo r the cards.

Years back, someone told me that really, the Internal Revenue rules required only that you have a receipt. Still, he added, that if you document everything, document the documentation and document the documenting of the documentation, the Internal Revenue man will give it a _pro-forma_ lookover, then throw you out of his office. If he sees that you have it together, he is not going to waste too much time on you, because it makes no economic sense for him to spend hours on you only to get a few hundred dollars, at the most. What he wants to see is some guy with no records, or walking in there with trash bags and shoe boxes with papers falling out everywhere. He will get a few dollars more out of those guys.

I do not know about anyone else, but if there is one place out of which I want to be kicked, it would be the Internal Revenue man's office. I will be out of there before he can pronounce the "T" on _*"GET OUT!"*_---the "T" on the "GET" part, that is............


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## Another Uber Driver (May 27, 2015)

UberTaxPro said:


> Did you do more than 600 trips?


I found the document. The answer is "no". It was two-hundred-six trips.


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## UberTaxPro (Oct 3, 2014)

Another Uber Driver said:


> Even if Uber collected the gross, took its and remitted the difference to us, we would still send a 1099? Please understand: this is a question, only. I am asking it to become informed, as I am woefully lacking in my knowledge of accounting and tax laws and procedures.
> 
> .....and I would be correct in assuming that if my accountant is of the calibre that I consider him to be, he would let me know to send it, or, he would send it on my behalf and inform me that he did so?
> 
> I am trying to learn, here. I am assuming from your ID, that you know your subject and that you would be the guy to ask on this forum.


 We're all here trying to learn here. I'm an ex 7 car taxi company owner who sold the business out of fear of Uber moving in. My Company was incorporated and I always did (for 15 yrs) the company taxes myself. I'm currently studying to be an E.A. (Enrolled Agent). To obtain the E.A. I have to pass 3 very difficult tests administered by the IRS. I've passed the 1st one and will be taking 2nd and 3rd by the end of this year. So I guess you could call me a 1/3 E.A. for now! When I complete the tests I'll be starting my own Tax Practice, doing tax returns and representing people dealing with the IRS. For now I'm an Uber driver. I do my studying in between trips.
I wouldn't lose any sleep over the 1099 issue. To me its interesting! One thing I have learned is that tax preparers don't know everything and they all do things differently. What you want is someone that knows your business type and stays current with the ever changing tax code. Sounds like you got a good accountant. If he had sent 1099's you would have received a copy and been informed and also probably billed for it. If you ever pay anyone $600 or more during the year from your business you should bring it to his attention like UberRidiculous said. 
Your question "Even if Uber collected the gross, took its and remitted the difference to us, we would still send a 1099?" I'm going to check this out more but if it was a T or F question on my test and I had to answer right now I would answer Y. Sorry about the name UberTaxPro....should be UberTaxProInAboutSixMonths!


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## UberTaxPro (Oct 3, 2014)

Fat Jack said:


> Here's an unrelated tax question.
> 
> If my full time job is 20 miles from my home and I turn on uber/lyft on my way home looking for a fare, even if I don't get one before reaching home can I still count those miles as an expense on my tax return?


Good question!


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## Fat Jack (Jul 5, 2015)

Let's approach this a different way. Let's say I ping myself and give myself a ride to work. Say the cost of the ride is $25. Uber takes $5, but I get to use the miles as an expense. 20m X 0.575cents equals $11.50. Actually I could end the ride anytime along the way and still count all the miles. So would it be worth giving uber $5 (or say $3) for $11.50 in expenses on my tax return? Or is this a stupid idea?


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## StarzykCPA (Aug 6, 2015)

UberTaxPro said:


> We're all here trying to learn here. I'm an ex 7 car taxi company owner who sold the business out of fear of Uber moving in. My Company was incorporated and I always did (for 15 yrs) the company taxes myself. I'm currently studying to be an E.A. (Enrolled Agent). To obtain the E.A. I have to pass 3 very difficult tests administered by the IRS. I've passed the 1st one and will be taking 2nd and 3rd by the end of this year. So I guess you could call me a 1/3 E.A. for now! When I complete the tests I'll be starting my own Tax Practice, doing tax returns and representing people dealing with the IRS. For now I'm an Uber driver. I do my studying in between trips.
> I wouldn't lose any sleep over the 1099 issue. To me its interesting! One thing I have learned is that tax preparers don't know everything and they all do things differently. What you want is someone that knows your business type and stays current with the ever changing tax code. Sounds like you got a good accountant. If he had sent 1099's you would have received a copy and been informed and also probably billed for it. If you ever pay anyone $600 or more during the year from your business you should bring it to his attention like UberRidiculous said.
> Your question "Even if Uber collected the gross, took its and remitted the difference to us, we would still send a 1099?" I'm going to check this out more but if it was a T or F question on my test and I had to answer right now I would answer Y. Sorry about the name UberTaxPro....should be UberTaxProInAboutSixMonths!


Best of luck with your EA Exams! Being a CPA, I know the pain.

Regarding the Form 1099s, something we're overlooking here is one of the main exceptions to filing a Form 1099. If the company/person is set up as a C or S Corporation, then there is no filing requirement (of course, there are exceptions to this exception, but none of which apply here). Even though Uber is a LLC, I'm willing to bet they are set up for tax purposes as a C Corporation (especially if they are going public). This means no 1099 is required. Whether or not the SRF merits a 1099 in the first place? I'm not 100% sure on that answer.



Fat Jack said:


> Let's approach this a different way. Let's say I ping myself and give myself a ride to work. Say the cost of the ride is $25. Uber takes $5, but I get to use the miles as an expense. 20m X 0.575cents equals $11.50. Actually I could end the ride anytime along the way and still count all the miles. So would it be worth giving uber $5 (or say $3) for $11.50 in expenses on my tax return? Or is this a stupid idea?


Probably not a good idea. $11.50 in expenses will roughly only save you $3.50 (though it depends on your tax rate). Intent is important too. Not to mention transactions entered into solely for tax avoidance purposes are generally frowned upon. In other words, this could come back to bite you...


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## Fuzzyelvis (Dec 7, 2014)

Fat Jack said:


> Let's approach this a different way. Let's say I ping myself and give myself a ride to work. Say the cost of the ride is $25. Uber takes $5, but I get to use the miles as an expense. 20m X 0.575cents equals $11.50. Actually I could end the ride anytime along the way and still count all the miles. So would it be worth giving uber $5 (or say $3) for $11.50 in expenses on my tax return? Or is this a stupid idea?


No because you also have another $20 in income now that you have to pay taxes on.


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## anna molly (Jan 24, 2015)

Fat Jack said:


> Let's approach this a different way. Let's say I ping myself and give myself a ride to work. Say the cost of the ride is $25. Uber takes $5, but I get to use the miles as an expense. 20m X 0.575cents equals $11.50. Actually I could end the ride anytime along the way and still count all the miles. So would it be worth giving uber $5 (or say $3) for $11.50 in expenses on my tax return? Or is this a stupid idea?


It's a bad idea. You can get deactivated for this.


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## UberTaxPro (Oct 3, 2014)

StarzykCPA said:


> Best of luck with your EA Exams! Being a CPA, I know the pain.
> 
> Regarding the Form 1099s, something we're overlooking here is one of the main exceptions to filing a Form 1099. If the company/person is set up as a C or S Corporation, then there is no filing requirement (of course, there are exceptions to this exception, but none of which apply here). Even though Uber is a LLC, I'm willing to bet they are set up for tax purposes as a C Corporation (especially if they are going public). This means no 1099 is required. Whether or not the SRF merits a 1099 in the first place? I'm not 100% sure on that answer.
> 
> Probably not a good idea. $11.50 in expenses will roughly only save you $3.50 (though it depends on your tax rate). Intent is important too. Not to mention transactions entered into solely for tax avoidance purposes are generally frowned upon. In other words, this could come back to bite you...


Your right! I would have got that question wrong! You only have to send 1099's to individuals.


StarzykCPA said:


> Best of luck with your EA Exams! Being a CPA, I know the pain.
> 
> Regarding the Form 1099s, something we're overlooking here is one of the main exceptions to filing a Form 1099. If the company/person is set up as a C or S Corporation, then there is no filing requirement (of course, there are exceptions to this exception, but none of which apply here). Even though Uber is a LLC, I'm willing to bet they are set up for tax purposes as a C Corporation (especially if they are going public). This means no 1099 is required. Whether or not the SRF merits a 1099 in the first place? I'm not 100% sure on that answer.
> Your right! I would have been wrong on that question. You only have to send 1099's to individuals.


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