# What about (personal) cell phone usage for tax purposes ?



## Joe Falcone (Oct 5, 2015)

So i've got an Iphone 6 . How much if any may i deduct for tax purposes ? Im on the next program and pay so much for the actual phone monthly. Plus the plan of corse.
I'm still trying to figure out the best way for car write off too. Mileage versus acual expenses. Rumor has it Turbo tax has provisions for idependant contractors. Thanks in advance for advice.
Joe


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## Old Rocker (Aug 20, 2015)

You can deduct the portion of your phone expenses that are business related.

The standard mileage deduction is the best choice for most people.

If you use Turbo Tax, either on line or buy the software, you need the upgraded version to get the Schedule C version.


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## Joe Falcone (Oct 5, 2015)

I was hoping for the mileage deduxtion as i wouldbt have to worry about every little expense and all. Its miles versus total auto exoenses right? So whats the best method of keeping trackbof miles? Beginning mileage whenEver Uber driving and then ending mileage? Doing this any day i drive and getting daily and weekly ubwr miles?


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## Old Rocker (Aug 20, 2015)

Joe Falcone said:


> I was hoping for the mileage deduxtion as i wouldbt have to worry about every little expense and all. Its miles versus total auto exoenses right? So whats the best method of keeping trackbof miles? Beginning mileage whenEver Uber driving and then ending mileage? Doing this any day i drive and getting daily and weekly ubwr miles?


Just keep a log book and record your mileage when you start and when you stop Ubering every day. There are some apps, too, but I don't know the names of any.


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## Willzuber (Aug 28, 2015)

Deduct every single cent you pay for that phone! 100%.


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## FlDriver (Oct 16, 2015)

Willzuber said:


> Deduct every single cent you pay for that phone! 100%.


Not if it's the only phone you have- claiming you use your only phone 100% for business is a good way to raise a red flag.


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## OneloveUberRaleigh (Nov 23, 2014)

https://www.sherpashare.com/ mileage tracker


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## StarzykCPA (Aug 6, 2015)

Just throwing out another idea: look at your phone's data usage by app. If 60% of your data usage is Uber, then deduct 60% of your cell phone bill. 

You have to come up with a reasonable method and be consistent with it. There is more than one method of doing this.


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## UberDriverTaxExpert (Nov 11, 2015)

100% cell phone use for business is a definite red flag and will be disallowed in an audit. 

Why in the world would you want to prepare your own taxes? Why risk an audit? Why are you not focusing on growing your business? Taking a loss (while legal) on a schedule C will increase your chance of an audit dramatically. You better have all your i's dotted and t's crossed. You have so many great tax options like possibly depreciating your vehicle OR setting up your own retirement plan OR getting advice that will help you plan for the future. Is it really a good idea to reduce all your earnings down to nothing just to get a refund OR not pay taxes? If you have the legit deductions then OK but one day you will apply for social security and receive $200 a month instead of $3000 a month. Work hard but smart. Hire a professional that knows your industry and can guide you into the future.

Don't speculate.....Hire a professional.


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## UberDriverTaxExpert (Nov 11, 2015)

There are a variety of ways to deduct your cellular telephone. The most important thing to remember is to always keep good records. I know it is time consuming but a simple notebook will usually do. If you have two cell phones (one for personal and one for business ) you may be able to deduct a larger percentage of the usage on the business phone. I normally do not write off 100% because in many audits that I have attended the auditor will ask "you've never called a friend, mom, wife, relative, delivery etc.", ever? Without written documentation they can easily disallow your deduction. You can also depreciate a cellular telephone. Especially the $500 and $600 cell phones. But again, only the percentage used for business. As an UBER driver you are literally a business and anything you purchase for business that is necessary and ordinary can be deducted and or depreciated over time or sectioned 179 (all at once). 

IRS definition: To be deductible, a business expense must be both ordinary and necessary. An ordinary expense is one that is common and accepted in your trade or business. A necessary expense is one that is helpful and appropriate for your trade or business. An expense does not have to be indispensable to be considered necessary.

Hope this helps.


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## UberTaxPro (Oct 3, 2014)

OneloverUberRaleigh said:


> https://www.sherpashare.com/ mileage tracker


do you allow sherpashare to access your uber account?


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## UberTaxPro (Oct 3, 2014)

Willzuber said:


> Deduct every single cent you pay for that phone! 100%.


Ya know in order to make any money with Uber you gotta work 24/7 taking naps in the car using the Uber ping as your alarm clock! Uber takes 100% of a driver's life. I think we should petition Congress for a special Uber driver deduction. They can call it the "Life Deduction". Everything in a driver's life will be deductible forever! It's the least Congress could do for us since we're providing low cost assisted transportation for the public. Just think of all the money we're saving the Federal Transit Administration! (this was inspired by your avatar Willzuber , thanks)


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## FlDriver (Oct 16, 2015)

StarzykCPA said:


> Just throwing out another idea: look at your phone's data usage by app. If 60% of your data usage is Uber, then deduct 60% of your cell phone bill.


What if you're on an unlimited data plan, like me? I already had unlimited text, talk, data before joining Uber, so I can't honestly say that my Ubering has increased my cell bill by even a penny. I pay about $100 a month for cell service, so even if I could write off half of it, it's really not that much of a tax deduction. I love tax deductions as much as anyone, but when they are questionable at best and not that much money, it's not worth the risk and hassle.

Even if you aren't on an unlimited plan, can you show that you are paying more for your phone because of Uber? What if you aren't hitting the limit for the plan you already have?


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## StarzykCPA (Aug 6, 2015)

FlDriver said:


> What if you're on an unlimited data plan, like me? I already had unlimited text, talk, data before joining Uber, so I can't honestly say that my Ubering has increased my cell bill by even a penny. I pay about $100 a month for cell service, so even if I could write off half of it, it's really not that much of a tax deduction. I love tax deductions as much as anyone, but when they are questionable at best and not that much money, it's not worth the risk and hassle.
> 
> Even if you aren't on an unlimited plan, can you show that you are paying more for your phone because of Uber? What if you aren't hitting the limit for the plan you already have?


You're right - for some it's not worth it.

The app/your phone is a significant and necessary part of your business. This is true even if you do not end up paying more for it (in the case of unlimited data).


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## werty (Oct 1, 2015)

If Uber is 90% of my data usage and 60% of my voice usage, what percentage of the phone bill do I claim as an expense?


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## UberTaxPro (Oct 3, 2014)

The Small Business Jobs Act of 2010 changed the way the IRS treats cell phones -- basically, the communication devices are no longer subject to strict documentation rules regarding business use. They are no longer considered "listed property". This *doesn't *mean that you no longer need records however.


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## UberTaxPro (Oct 3, 2014)

werty said:


> If Uber is 90% of my data usage and 60% of my voice usage, what percentage of the phone bill do I claim as an expense?


Treat the total phone use (data and voice) together and figure % on that.


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## UberTaxPro (Oct 3, 2014)

The best way to deduct 100% cell phone use is to use the phone 100% for business! The best and easiest way to prove it is to have a second phone.


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## werty (Oct 1, 2015)

UberTaxPro said:


> Treat the total phone use (data and voice) together and figure % on that.


How do I combine the two percentages into one overall percentage?


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## UberTaxPro (Oct 3, 2014)

werty said:


> How do I combine the two percentages into one overall percentage?


looks to be about 3/4 business use to me. I did it with pictures I drew, can't really explain how (or if its right) Maybe this guy can help:
http://qz.com/552327/the-nigerian-mathematics-genius-who-fooled-the-british-media/


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## Krisi86 (Sep 19, 2016)

What if your current cell phone is zero and you upgrade for more data due to Uber? I currently have FreedomPop and my bill is 0 I get unlimited talk and text and 500 MB data for free I've had it this way for well over a year. I never go near my data limit because I usually am in wifi areas and truthfully I'm a light cellphone user. I barely make calls primarily text and light web surfing. But since I have been doing Uber it's been burning through my data and I am at the point where I need to purchase more data or my service is shut down until the next cycle starts. The option is $20 a month for 2 Gigs data. Could I deduct the whole $20 as a business expense since the only reason I am purchasing it is to be able to Uber? My past bills data usage has been on average under 200 MB.

Thanks in advance for any input.


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## UberTaxPro (Oct 3, 2014)

Krisi86 said:


> What if your current cell phone is zero and you upgrade for more data due to Uber? I currently have FreedomPop and my bill is 0 I get unlimited talk and text and 500 MB data for free I've had it this way for well over a year. I never go near my data limit because I usually am in wifi areas and truthfully I'm a light cellphone user. I barely make calls primarily text and light web surfing. But since I have been doing Uber it's been burning through my data and I am at the point where I need to purchase more data or my service is shut down until the next cycle starts. The option is $20 a month for 2 Gigs data. Could I deduct the whole $20 as a business expense since the only reason I am purchasing it is to be able to Uber? My past bills data usage has been on average under 200 MB.
> 
> Thanks in advance for any input.


Yes, if you use the data purchased 100% for Uber you can deduct 100% of the cost.


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## Krisi86 (Sep 19, 2016)

Thanks for the quick reply. I think the grey area here is that this will change my plan to a 2 gig plan so the data usage will be mixed but ultimately I know my personal usage would be well under my typical 500 mb allotment that I would have gotten free. Unless I just leave my plan as is and open the automatic billing where it will automatically charge me for any data usage over 500 Mb. It's more expensive this way per mb but I'd only be paying for what I exactly use and I guess I could just write the overages off as an expense. 

I'm not trying to scam uncle Sam but I really don't feel I should pay for any service because for my personal use I haven't been for 20 months and counting. I feel now because of Uber I have a need to upgrade but am going to be responsible for a portion since ultimately it's mixed but I'm certain my personal use isn't anywhere near my typical 500 mb freebie. If that makes sense. 

Let's say I kept track of the data usage as reported by my device on a monthly basis, and added up the Uber app, Google maps, and the messenger app I use for making Uber calls (it's different from the one I use for personal use...think Google voice) as business data usage and the rest personal and just used the data ala carte and did the math would that work? 

For example so far in 2 days I've used 102 Mb in those "business" apps alone my total data usage is at 257 mb from the start of the billing cycle at the beginning of the month. 

Let's say at the end of the month I'm at 800 Mb usage with 500 Mb from the business apps and 300 Mb from the personal apps. Can I charge off the total overages in data as a business expense for the month since my personal use didn't go over my typical free limit?

I'm trying to figure out if it's looked at as a whole or the usage and timing of each mb of data matters. For example I get 500 Mb free and Uber tears through that mid way through the month and now I'm using data ala carte for the remainder of the billing cycle so it's mixed usage a little personal and a lot business. During the overage ala carte period i would be using some data for personal use. Would they look at it like that isn't a business expense because at that exact time and very moment that particular Mb of data was personal when I got billed for it and ignore the fact that my normal plan is 500 Mb free and my overall personal use didn't go near that free amount? 

Sorry for such a long explanation. If anyone bothered reading through this thank you! Lol I appreciate any feedback. 

I really don't want to get a separate line and phone for Uber. It's more convenient to just use one device but I also want to do the right thing legally and morally and I don't want to pay for stuff I don't really use personally. So again thanks if you suffered through my long post and I appreciate any feedback or input.


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## UberTaxPro (Oct 3, 2014)

Well you might be overthinking this just a little bit  The important thing is to pick a fair method of figuring your business % use of the data plan and being consistent with the method. I would keep copies of your current billing going back over the last year or so you can clearly show that you didn't use this data plan at all before driving for Uber. The fact that you didn't have this plan before driving for Uber helps to justify your business use of this data plan. Make your best estimate of business use vs. personal use and stick with it. If you're not going over 500mb of personal use I think you could justify deducting 100% of this plan. Otherwise, come up with your best estimate 95% business 5% personal, or 80% business 20% personal, etc... and use it consistently every month. If you want to work out the exact amounts each month you can do that if it's even possible? Sounds like to much work to me!


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## Krisi86 (Sep 19, 2016)

Thank you! I agree I probably am over thinking it lol. I just get nervous about the IRS and stuff. I'm really not doing this full time so I probably shouldn't worry but I just want to do the right thing because I don't want them coming after me for something minor and silly like this. Thank you again!


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## StarzykCPA (Aug 6, 2015)

Krisi86 said:


> Thank you! I agree I probably am over thinking it lol. I just get nervous about the IRS and stuff. I'm really not doing this full time so I probably shouldn't worry but I just want to do the right thing because I don't want them coming after me for something minor and silly like this. Thank you again!


Even if you are not doing this full-time, your tax/record-keeping requirements are the same as a full-time person. Albeit, you will probably have less documents. But good questions and some good advice here .


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