# Taxes after deductions?



## LordOdin (Feb 7, 2017)

I just started Uber a couple months ago and am not sure how the financials work for this. I'm required to pay 28% of net income for my 2 kids in Illinois. The problems lies with deductions and taxes. From what I understand, the pay we receive is gross but is treated like a business expense and has deductions. I've never had a business before. After the deductions, how do we calculate the taxes that are supposed to be paid for it?

Only after the taxes are deducted can I figure out how much I owe for my child support.


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## Older Chauffeur (Oct 16, 2014)

LordOdin said:


> I just started Uber a couple months ago and am not sure how the financials work for this. I'm required to pay 28% of net income for my 2 kids in Illinois. The problems lies with deductions and taxes. From what I understand, the pay we receive is gross but is treated like a business expense and has deductions. I've never had a business before. After the deductions, how do we calculate the taxes that are supposed to be paid for it?
> 
> Only after the taxes are deducted can I figure out how much I owe for my child support.


I'm not a tax professional, but here's my two cents' worth. Your Uber income and expenses are figured using Schedule C (business profit/loss) and Schedule SE (self employment ). If your net profit is $400 or more, you pay FICA, which is separate from any income tax due. The results flow to your regular tax return as added income or loss. I hope you kept a log of all miles driven for Uber, including those without pax- "dead" miles. That deduction along with cell phone use related to business should make your income negligible or even a loss. Note that Uber supplies you with the gross fares, out of which you need to deduct their commissions and fees to get to a figure that matches your bank deposits. That's the net revenue for your business, from which you deduct your mileage, phone, etc.
Tax programs are able to do the calculations for you, just make sure you're getting those two schedules. Turbo Tax has everything you need in their Deluxe version, provided you buy the CD format. If you are filing online, you have to upgrade to get those schedules.


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## ubercpas (Feb 7, 2017)

even if you dont pay for the more expensive version, just deduct taxes it says need to be paid, and then you have your after tax income. after tax income = gross uber -deductions - taxes


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## Mars Troll Number 4 (Oct 30, 2015)

LordOdin said:


> I just started Uber a couple months ago and am not sure how the financials work for this. I'm required to pay 28% of net income for my 2 kids in Illinois. The problems lies with deductions and taxes. From what I understand, the pay we receive is gross but is treated like a business expense and has deductions. I've never had a business before. After the deductions, how do we calculate the taxes that are supposed to be paid for it?
> 
> Only after the taxes are deducted can I figure out how much I owe for my child support.


*Not a tax professional*

Consult a lawyer..

Seriously this is going to blow up in your face. REALLY bad.

There's a distinct possibility that you will show as actually LOSING money on paper, because this is the way it works out with the rates being as low as they are.

If your only income is off uber, you *might* be accused of cheating on your documents to show on your documents that you lost money in your business venture so that you don't have to pay child support, or so that you pay less.

At the end of the day... This is going to blow up in your face. Most drivers in most markets show a loss on paper if they properly document their miles.

The only thing i can tell you is that if your honest with your numbers, your going to look like a tax cheat, and then things go south from here.

If it's court ordered... (Which i'm guessing it is no offense) your going to need a lawyer to straighten this out.


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## LordOdin (Feb 7, 2017)

So deductions are pre-tax and not post-tax, correct?


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## Older Chauffeur (Oct 16, 2014)

LordOdin said:


> So deductions are pre-tax and not post-tax, correct?


Yes, you deduct allowable expenses from your gross earnings to arrive at your taxable net profit, if any. This is a bit over-simplified, but that's the gist of it. You have things like personal exemptions and adjusted gross income that figure in.


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## UberTaxPro (Oct 3, 2014)

LordOdin said:


> So deductions are pre-tax and not post-tax, correct?


Yes, deductions can lower or sometimes even eliminate your taxable income.


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## Mars Troll Number 4 (Oct 30, 2015)

UberTaxPro said:


> Yes, deductions can lower or sometimes even eliminate your taxable income.


And lower your taxable income from other sources because the rates are just that terrible as well..

IE before uber your 9/5 job would have you earning enough to pay X per year, however after adding your uber income and deductions it's possible (or probobly depending on the market) that you will end up owing LESS in taxes than if you hadn't ubered at all.


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## Subjugator (Jun 22, 2016)

And when you are at a loss, you can carry that over to lets say having a w2 job, do your standard deductions on that plus the loss from the business which allows you to have a lower tax payment on the w2 side which means you get money back.


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