# Taxes! Is it ok to claim insurance cost deduction for Uber dedicated car?



## SafeT (Nov 23, 2015)

This is probably answered in one of the many hundreds of posts about taxes, but I don't want to spend days reading them all.

The specific question I have is this.* Assuming you are claiming the standard mileage deduction, if you have a dedicated car for Uber or Lyft, is the insurance cost for that dedicated car deductible or not?*

Please only respond if you are over 90% certain of your answer. Unfounded opinions are not really helpful since we are dealing with the IRS.


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## Older Chauffeur (Oct 16, 2014)

SafeT said:


> This is probably answered in one of the many hundreds of posts about taxes, but I don't want to spend days reading them all.
> 
> The specific question I have is this.* Assuming you are claiming the standard mileage deduction, if you have a dedicated car for Uber or Lyft, is the insurance cost for that dedicated car deductible or not?*
> 
> Please only respond if you are over 90% certain of your answer. Unfounded opinions are not really helpful since we are dealing with the IRS.


Insurance is a cost of operating the vehicle included in the SMR.


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## Older Chauffeur (Oct 16, 2014)

http://www.companymileage.com/howmileageratedetermined.html
There's a graph on this page which shows the breakdown of the SMR.


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## SafeT (Nov 23, 2015)

Older Chauffeur said:


> http://www.companymileage.com/howmileageratedetermined.html
> There's a graph on this page which shows the breakdown of the SMR.


Thanks for the info! Looks like you are correct. So that being the case, the less I drive and get paid the more the insurance cost is going to hurt.

https://www.irs.gov/publications/p463/ch04.html#en_US_2015_publink100033935
If you use the standard mileage rate for a year, you cannot deduct your actual car expenses for that year. You cannot deduct depreciation, lease payments, maintenance and repairs, gasoline (including gasoline taxes), oil, *insurance, or vehicle registration fees*. See Choosing the standard mileage rate and Standard mileage rate not allowed, later.


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## Older Chauffeur (Oct 16, 2014)

SafeT said:


> Thanks for the info! Looks like you are correct. So that being the case, the less I drive and get paid the more the insurance cost is going to hurt.
> 
> https://www.irs.gov/publications/p463/ch04.html#en_US_2015_publink100033935
> If you use the standard mileage rate for a year, you cannot deduct your actual car expenses for that year. You cannot deduct depreciation, lease payments, maintenance and repairs, gasoline (including gasoline taxes), oil, *insurance, or vehicle registration fees*. See Choosing the standard mileage rate and Standard mileage rate not allowed, later.


Well, each person's situation is different, depending on other sources of income and actual vehicle operating costs. For instance, if you have an older, paid for economy car, the SRM write off helps you keep more of your gross pay. You're in effect making a "profit," or the difference between your cost per mile and the IRS deduction. But yes, if you're looking at costs per mile, up to a point the more miles you drive, the lower that number will be. At higher miles, however, maintenance and fuel costs matter more than somewhat fixed costs like insurance.
If you are doing this as a side job, and have W2 witholding from a regular job, the write offs can help you lower your total tax liability, perhaps saving some taxes on your main income.
Keep in mind that at least to some extent, the income from Uber/Lyft is coming from the value/equity you have in your car.


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