# Percentage of taxes taken from income



## Nick781

What is it? any guides out there.


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## Uberectile Dysfunction

None, you get a form 1099 come tax season and youll pay then. Save now, track expenses and mileage for all driving while logged on to Uber. Keep reciepts. Contact a tax accountant in your area. You can also pay quarterly taxes. If you save 15 to 20 percent from all income youll be alright and have a little savings built up after you pay taxes.


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## StarzykCPA

No guides because it does vary a lot based on your individual circumstances. Everyone's net income calculation will be different along with varied income tax rates depending on what else you have going on and how much money you are making. As mentioned above, 20% is a step in the right direction towards setting aside some money.

Your tax preparer can help set you up with quarterly estimates if needed. It all depends on your income and your tax withholdings from other jobs, if any.


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## Argel

Nick781 said:


> What is it? any guides out there.


Nick, as mentioned above it varies based on individual's tax profile. PM me and I'll help you figure out what % you should be saving for taxes.


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## mike777

The Washington post did this story on Uber and taxes....If $50,000 is on the 1099 that Uber sends you" Add the federal income, SECA taxes and ACA fee together, and you’ll owe about $9,500 in taxes, or 25 percent of your net earnings. I personally was a cab driver in Las Vegas and the accounting dept did everything and you got a W2 in the mail in January. I bet nobody knows how to do a 1099 and a lot aren't going to even bother, on top of that your supposed to estimate your taxes ever 3 months and send the IRS a check. Uber drivers are private businessman now.


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## makinthemagic

Argel said:


> Nick, as mentioned above it varies based on individual's tax profile. PM me and I'll help you figure out what % you should be saving for taxes.


Your best bet is to do a pro-forma income tax return and estimate what your taxes will be. Estimated taxes/total income=effective tax rate %


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## driverguy77

What about rides you take that aren't Uber trips? For example, I've had to drive BACK from going far from my home, is that tax deductible? I would have liked to have a trip back, but didn't want a trip that would take me further from home.


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## cheerose

Was your app on? If so, then it should be deductible ... If not , then it's not. 

While I am a CPA & a tax preparer... I am not your tax preparer & CPA


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## driverguy77

cheerose said:


> Was your app on? If so, then it should be deductible ... If not , then it's not.
> 
> While I am a CPA & a tax preparer... I am not your tax preparer & CPA


You mean, when I drove home? No, I don't want to keep it on because of this. You can see how if not going to pick up, or drop off, you are not covered at all, not by my personal policy, and very little by Uber.

http://newsroom.uber.com/2014/02/insurance-for-uberx-with-ridesharing/


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## Ubercentralnj

driverguy77 said:


> What about rides you take that aren't Uber trips? For example, I've had to drive BACK from going far from my home, is that tax deductible? I would have liked to have a trip back, but didn't want a trip that would take me further from home.


I'm still researching but I believe that if you claim a Home Office, then all miles from home (with the intention of Ubering, even heading out to a busy location to catch more requests), driving a pax, and returning home are deductible. Assuming no personal stuff in between. If not claiming a Home Office then you may not be able to claim miles until you reach your first business contact (i.e. make your first pax pickup). No miles leaving home until you pick up, and no miles back home.


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## IckyDoody

I would say that under the spirit of the law, miles driven from home with app on and with the intention of accepting requests are in fact work miles.

With that said, I'm talking out of my ass, so I may be wrong.


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## Uberselectguy

In any case, your home to first pickup is treated as commute miles by the IRS. Same applies to your last trip drop off, then home.
Matters not when you turn the app on. It's where you get first rider. I have a post office near my home. I opened up a po box and had Uber send all mail to it. Home to post office, commute miles. Post office to first ride, business miles.

For an IRS audit, you will be under mileage scrutiny more than anything else. Keep. Rey detailed logs each day. Make no mistake about it, get sloppy and you'll get slammed.


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## LAuberX

I never leave my house until I get a ping. Zero commute miles. I am being paid for that job, it begins when I get the ping. My app is on all the way home, I'm working, not commuting.

A "commute" is driving to or from a "work" location. This does not apply to an Uber that is "working" and willing to take a job anytime the app is on. 

App "ON" = WORK Location.


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## Uberselectguy

LAuberX said:


> I never leave my house until I get a ping. Zero commute miles. I am being paid for that job, it begins when I get the ping. My app is on all the way home, I'm working, not commuting.
> 
> A "commute" is driving to or from a "work" location. This does not apply to an Uber that is "working" and willing to take a job anytime the app is on.
> 
> App "ON" = WORK Location.


Sorry my friend. Commute miles are from your home to first "business appointment". If you pick up a pax a mile from your home, commute is 1 mile for that day.
I was audited last year, I went through the process. My CPA versed me when I started Uber, thank god. The only point the IRS got me on was the ratio of depreciation on my car used with Uber. I said 88%, they argued successfully 72%. Cost me about a grand extra in taxes, fines and interest.


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## LAuberX

A "business appointment" is different. When I was in sales driving to my first call was truly a commute, I was not being paid to go there.

With Uber you get a ping and you are "working". You are being paid for that job, that is work. Taxi/Limo differs from traditional business travel.

Thanks for sharing your audit experience, I will read some more and bounce it off a cpa.... I have never been audited, only got a few letters when my accountant could not keep up with my volume of day trades.


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## Uberselectguy

My audit last year was triggered due to some capital gains on stock trades, but once I was across the table from the auditor she said ... " we will also want to focus on your Uber and Lyft earnings and expenses". ... my CPA said that a colleague of his made mention that uber and Lyft raises eyebrows at the IRS due to the vast number of errors made by drivers reporting expenses.

Here is another interesting note I got from my CPA. Drivers may be hit with an assumption of tip income. Just like waitresses, where they pay taxes on an additional assumed tip income .. Uber drivers and Lyft drivers may face the same thing. As a waitress, if you make $100 in gross, the IRS places an assumption that you made $15 in tips. Wouldn't that be a charm if they did the same to drivers? Uber wouldn't care.


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## Ubercentralnj

Uberselectguy said:


> Sorry my friend. Commute miles are from your home to first "business appointment". If you pick up a pax a mile from your home, commute is 1 mile for that day.
> I was audited last year, I went through the process. My CPA versed me when I started Uber, thank god. The only point the IRS got me on was the ratio of depreciation on my car used with Uber. I said 88%, they argued successfully 72%. Cost me about a grand extra in taxes, fines and interest.


Finally, someone who knows what they are talking about! I'm sorry you were audited, but did your CPA discuss commuting miles if you claim a Home office? Based on what I've skimmed on the IRS website going to / from business contacts and your home office is considered a business expense and not commuting. I'd love to get confirmation.


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## Uberselectguy

Yes, I had a conversation concerning my "home office". I have a legit home office, it is a separate office space aside from my house. I am doing a start up and use that office professionally. In discussions with my CPA, I was discouraged from using any type of "home office" for Uber since, at the very most there is little Uber business actually conducted from a home office. If you were put onto the hot seat by the IRS auditor you would have to qualify your home office as follows..
1) what percentage of your uber income is derived from your home office ( zero? Less than 5%?)
2) is having that home office an integral part or requirement of driving for Uber ( no)
3) what equipment, supplies or other assets in your home office are needed for Uber ( none )

Right about at this point your auditor will say " disallowed " and disqualify your commute mile deduction as it relates to your home office.

I brought it up to my CPA a couple of years ago, he smiled and said if you do, make sure you set aside a few grand for the post audit taxes and penalties.


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## Rogeo

I DO KNOW IF YOU HAVE A RENTAL PROPERTY ANY TRAVEL TO AND FROM THERE CAN BE DEDUCTIBLE. EVEN IF YOU DON'T CLAIM A HOME OFFICE, OR AT LEAST TURBO ASKED FOR THOSE MILES EVERY YEAR I DO MY TAXES.


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## Ubercentralnj

Uberselectguy said:


> Yes, I had a conversation concerning my "home office". I have a legit home office, it is a separate office space aside from my house. I am doing a start up and use that office professionally. In discussions with my CPA, I was discouraged from using any type of "home office" for Uber since, at the very most there is little Uber business actually conducted from a home office. If you were put onto the hot seat by the IRS auditor you would have to qualify your home office as follows..
> 1) what percentage of your uber income is derived from your home office ( zero? Less than 5%?)
> 2) is having that home office an integral part or requirement of driving for Uber ( no)
> 3) what equipment, supplies or other assets in your home office are needed for Uber ( none )
> 
> Right about at this point your auditor will say " disallowed " and disqualify your commute mile deduction as it relates to your home office.
> 
> I brought it up to my CPA a couple of years ago, he smiled and said if you do, make sure you set aside a few grand for the post audit taxes and penalties.


Thanks for your input. I'll consider what your guy said, i really value hearing what the pro's jave to say. Although I disagree with the point about % income derived - I don't see that listed in the IRS regs as a requirement. As far as Integral, we all have to keep records, and jotting down the log in the car doesn't cover all of that. I need to verify Ubers billing which is frequently wrong, communicate with Uber to get those fares adjusted, estimate my quarterly taxes, Research upcoming events on my driving area to develop a strategy to increase ride opportunities. I use my office quite a bit for Uber related activities. Equipment and supplies? My computer, printer, desks pace to work, Internet access, etc. The regs say that you can claim a Home office even if you can do your administrative activities elsewhere, but choose to use your home office anyway. They give an example of a doctor who does his billing from home, despite the fact that the hospital provides him am office- they say that is acceptable as home office use as long as the use is exclusive and regular (i.e. done on a regular basis ). I'm going from memory but that is the jist. Right now I'm leaning towards claiming the office, but I'm still researching and gathering input from wherever I can.


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## UberTaxPro

Uberselectguy said:


> Sorry my friend. Commute miles are from your home to first "business appointment". If you pick up a pax a mile from your home, commute is 1 mile for that day.
> I was audited last year, I went through the process. My CPA versed me when I started Uber, thank god. The only point the IRS got me on was the ratio of depreciation on my car used with Uber. I said 88%, they argued successfully 72%. Cost me about a grand extra in taxes, fines and interest.


If you were taking depreciation on your Uber car you must have been using the Actual Expenses method vs the Mileage method. You can't deduct depreciation using the Mileage method. The Actual Expense method makes all of your uber business miles not deductible. Sounds like your issue was about commuter miles not the 57.5(or whatever it was for your year) cents standard mileage deduction used by most Uber drivers. Right?


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## ubermeister

Nick781 said:


> What is it? any guides out there.


While your end of year tax rate depends upon the tax bracket you fall under based upon all of your income, the fed generally suggests paying 15.4% for your quarterly tax estimates. Full disclosure - I'm working on a startup that helps Uber drivers get a real time view at their after tax income. Feel free to message me for more details!


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## UberTaxPro

ubermeister said:


> While your end of year tax rate depends upon the tax bracket you fall under based upon all of your income, the fed generally suggests paying 15.4% for your quarterly tax estimates. Full disclosure - I'm working on a startup that helps Uber drivers get a real time view at their after tax income. Feel free to message me for more details!


I think you mean 15.3% for the first $118,500 of income. This is just the self employment tax called FICA. What about withholding for income tax? Income tax is in addition to FICA. Nice idea with your business but the problem is with Uber rates as low as they are now most Uber drivers netting $0 after expenses! How are they going to pay you?


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## Nick781

what is the income tax rates ? for self employment


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## Nick781

UberTaxPro said:


> I think you mean 15.3% for the first $118,500 of income. This is just the self employment tax called FICA. What about withholding for income tax? Income tax is in addition to FICA. Nice idea with your business but the problem is with Uber rates as low as they are now most Uber drivers netting $0 after expenses! How are they going to pay you?


If you use mileage deduction you do...


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## UberTaxPro

Nick781 said:


> If you use mileage deduction you do...


not sure what you mean?


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## UberTaxPro

Nick781 said:


> what is the income tax rates ? for self employment


Income tax rates are the same whether you work for someone else or are self employed. For 2015 they are:

Individuals

_
Married Individuals Filing Joint Returns and Surviving Spouses_









_Married Individuals Filing Separate Returns_









Head of Household


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## LAuberX

great charts.

I used to dream about having a "tax problem" now I just wait hours for a decent ping.


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## ubermeister

LAuberX said:


> great charts.
> 
> I used to dream about having a "tax problem" now I just wait hours for a decent ping.


I feel you...


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