# Tax advice



## D31 (Jan 10, 2017)

I am a Part-Time driver. I use my car for both business (Uber and my Full-Time job) and pleasure. Therefore, I'd say I'm using my car for Uber maybe 50% of the time.

I only been driving since mid-November. So I will have only driven for Uber for about 6 weeks of 2016. Obviously, that's just a tiny bit.

I started using Mileage-IQ and have saved ALL my gas and maintenance receipts (not food and small things, etc). I am pretty sure I can't get a full write-off for deducting the full gas and maintenance amounts (or at least 2 people at H&R said, and I guess it makes sense to me). Wear-and-Tear and gas was honestly not caused because I drove part time for 6 out of the 52 weeks I 2016. I spent about $1200 on brakes and struts in late December - I would love to get full deduction, but I don't think I would.

What are your thoughts? Should I still itemize it all out; or should I deduct fully my Business-related mileage; or should I just go with standard deduction ($0.54/mile - or whatever it is)?

Also, advice for 2017 (assuming I will drive for Uber the entire 52 weeks, part-time)?

Thanks!


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## Older Chauffeur (Oct 16, 2014)

D31 said:


> I am a Part-Time driver. I use my car for both business (Uber and my Full-Time job) and pleasure. Therefore, I'd say I'm using my car for Uber maybe 50% of the time.
> 
> I only been driving since mid-November. So I will have only driven for Uber for about 6 weeks of 2016. Obviously, that's just a tiny bit.
> 
> ...


I'm not a tax professional, but here's my take.
1. You can only take the portion of actual costs to operate your car that your mileage tracker show are related to business use. (I'm not clear from your post if you use your car as part of your f/t job, or just commuting.) But say it's the latter, and foe example you put 15000 miles on your car, 5000 of which were for ridesharing activities. Of that $1200 you would deduct only one third, or $400. You would do the same thing with the gas and maintenance. 
The standard mileage rate in the same scenario would give you a deduction of $2700. (5000 X $0.54)

2. I don't know what you mean by, "or should I deduct fully my business-related mileage; or should I go with the standard deduction?" That's basically the same thing.

3. For most Uber/Lyft drivers the mileage deduction works out better than the actual costs, and is a lot easier to figure. Be sure you are counting the empty or "dead" miles as well as the ones with pax on board.

For 2017 track mileage, portion of cell phone use for business, etc. And if you haven't already done so, get rideshare insurance/rider. It's important!


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## UberTaxPro (Oct 3, 2014)

D31 said:


> I am a Part-Time driver. I use my car for both business (Uber and my Full-Time job) and pleasure. Therefore, I'd say I'm using my car for Uber maybe 50% of the time.
> 
> I only been driving since mid-November. So I will have only driven for Uber for about 6 weeks of 2016. Obviously, that's just a tiny bit.
> 
> ...


Standard Mileage Deduction is almost always better for Uber drivers. One thing you need to consider is that if you use the actual expense method you can't switch to the SMD ever for the same vehicle.


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## D31 (Jan 10, 2017)

UberTaxPro said:


> Standard Mileage Deduction is almost always better for Uber drivers. One thing you need to consider is that if you use the actual expense method you can't switch to the SMD ever for the same vehicle.


So then I shouldn't bother with MileageIQ then? Uber only pays for the mileage I have a passenger. Does the $0.54 deduction from the IRS suppose to somewhat cover the other mileage, maintenance, gas, etc? Can I deduct the miles I racked up from Mileage IQ and still use standard deduction?


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## Emerald43 (Oct 21, 2016)

D31 said:


> So then I shouldn't bother with MileageIQ then? Uber only pays for the mileage I have a passenger. Does the $0.54 deduction from the IRS suppose to somewhat cover the other mileage, maintenance, gas, etc? Can I deduct the miles I racked up from Mileage IQ and still use standard deduction?





D31 said:


> So then I shouldn't bother with MileageIQ then? Uber only pays for the mileage I have a passenger. Does the $0.54 deduction from the IRS suppose to somewhat cover the other mileage, maintenance, gas, etc? Can I deduct the miles I racked up from Mileage IQ and still use standard deduction?


uhhh assuming I am understanding your question correctly here. You can use the 54 cents SMD to deduct mileage you don't have a passenger in the car as well. (i.e. miles in between rides and driving around looking for passengers). Assuming your app was on.


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## D31 (Jan 10, 2017)

Emerald43...I think you answered what I needed. Since I am only a Part-Time Uber and even though I have had to do some maintenance, it sounds like I should just do the standard deduction of $0.54/mile for both what Uber reports (which is with passengers) and the mileage of driving to pick up passengers. That would mean I could use what I've been logging on MileIQ as business related mileage and claim all the miles and multiply by $0.54


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## El Gato (Mar 5, 2016)

Also, if you paid for MileIQ don't forget to deduct that as a business expense!!


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## makinthemagic (Oct 8, 2015)

Emerald43 said:


> uhhh assuming I am understanding your question correctly here. You can use the 54 cents SMD to deduct mileage you don't have a passenger in the car as well. (i.e. miles in between rides and driving around looking for passengers). Assuming your app was on.


That is correct. As long as the app is on and you are available to take a passenger, or have a passenger, you can deduct that mileage. You really have to track that yourself as the the company will only report your miles with passenger, which can be a fraction of the total you could be allowed to claim, and may not be accurate.


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## D31 (Jan 10, 2017)

El Gato said:


> Also, if you paid for MileIQ don't forget to deduct that as a business expense!!


But I thought I can't itemize deductions (such as MileIQ cost) if using a Standard Deduction.


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## LAuberX (Jun 3, 2014)

D31 said:


> But I thought I can't itemize deductions (such as MileIQ cost) if using a Standard Deduction.


You can't itemize any more car deductions if you use the standard mileage deduction.... other legitimate business expenses are still deductible.


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## D31 (Jan 10, 2017)

LAuberX said:


> You can't itemize any more car deductions if you use the standard mileage deduction.... other legitimate business expenses are still deductible.


Sorry for all these never-ending questions. So if I use the Standard Deduction, what business expenses are deductible? Then again, what would be considered itemized deductions that I would not be able to use?


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## Older Chauffeur (Oct 16, 2014)

D31 said:


> Sorry for all these never-ending questions. So if I use the Standard Deduction, what business expenses are deductible? Then again, what would be considered itemized deductions that I would not be able to use?


Disclosure: I'm not a tax professional. Some of this may have been covered already.

First, just to be clear, the terms "standard deduction" and "itemized deductions" that probably come to mind for most tax payers are on the Form 1040 Schedule A. You use one or the other, depending on your situation.

OTOH, the "Standard Mileage Rate" (SRM) and "Business Expenses" are used in filing your Schedule C, profit and loss from business.

To claim either the SRM or actual vehicle expenses, you need an accurate, contemporaneous mileage log. The mileage tracking programs may satisfy this requirement, but I haven't read anything either way from the IRS.

Now, to your questions. If you use the SRM, you are covering all the normal costs of operating a vehicle- gas, tires, maintenance- all the normal stuff you pay for as an owner, whether or not you use the car in business.

If you use the actual expense method, you also need all expense receipts. The percentage of those expenses allowed would be based on the ratio of personal to business miles. For most Uber drivers the SRM is the way to go.

Some folks believe you can deduct extra car washes due to the need to have the car always clean for Uber, say more than one per week. The same might apply to the extra cost of a rider on your personal insurance policy. You may have to someday argue the finer points with an IRS agent, so save your documentation.

In addition to your car costs, under business expenses you can deduct the commissions and fees that Uber included in your 1099 that didn't wind up in your bank account, along with the portion of your cell phone costs attributed to business use. Your mile tracking program would be a legitimate expense, in my opinion. (I deduct the price of the Day Minder book I buy every year to keep my mileage log.) If you buy supplies for client use, like aux cables, water, mints, etc those are deductible. A dash cam might be another deductible expense, but again, you may have to convince an IRS agent of the need for it.

Hope this helps.


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## D31 (Jan 10, 2017)

Older Chauffeur said:


> Disclosure: I'm not a tax professional. Some of this may have been covered already.
> 
> First, just to be clear, the terms "standard deduction" and "itemized deductions" that probably come to mind for most tax payers are on the Form 1040 Schedule A. You use one or the other, depending on your situation.
> 
> ...


Thank you. I think you answered everything. I guess I was a bit confused between Standard Deduction and Standard Mileage Rate and now I see there's a difference. Also, that I can claim non-auto related business items (MileIQ program fee, rider perks [cell phone chargers, etc], Uber fees, etc) even if I take the Standard Mileage Rate. You've also cleared up for me that the SMR accounts for (easier average than itemizing) for not just what Uber counts as mileage, but also gas, maintenence, etc. Thank you so much and again, to everyone, sorry for being clueless on much of this.


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

D31 said:


> Thank you. I think you answered everything. I guess I was a bit confused between Standard Deduction and Standard Mileage Rate and now I see there's a difference. Also, that I can claim non-auto related business items (MileIQ program fee, rider perks [cell phone chargers, etc], Uber fees, etc) even if I take the Standard Mileage Rate. You've also cleared up for me that the SMR accounts for (easier average than itemizing) for not just what Uber counts as mileage, but also gas, maintenence, etc. Thank you so much and again, to everyone, sorry for being clueless on much of this.


YOU CAN DEDUCT TOLLS ON TOP OF STANDARD MILEAGE.

IE if you drive 200 miles in one day, (and have $15 in tolls)

Your standard mileage would like like...

200 X .54c (at 54c per mile)

$108 in mileage
+\
15 in tolls

$123 in deductible business expenses..


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## El Gato (Mar 5, 2016)

Mears Troll Number 4 said:


> Standard mileage DOES NOT COVER TOLLS...


Not accurate. From IRS Instructions for Schedule C:
*Pat II: Expenses
Line 9*
If you take the standard mileage rate: Multiply the number of business miles driven by 54 cents, and Add to this amount your parking fees and tolls. Enter the total on line 9. https://www.irs.gov/pub/irs-pdf/i1040sc.pdf​From IRS *Publication 463*:
*Standard Mileage Rate*
Parking fees and tolls. In addition to using the standard mileage rate, you can deduct any business-related parking fees and tolls https://www.irs.gov/pub/irs-pdf/p463.pdf​


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## Older Chauffeur (Oct 16, 2014)

El Gato said:


> Not accurate. From IRS Instructions for Schedule C:
> *Pat II: Expenses
> Line 9*
> If you take the standard mileage rate: Multiply the number of business miles driven by 54 cents, and Add to this amount your parking fees and tolls. Enter the total on line 9. https://www.irs.gov/pub/irs-pdf/i1040sc.pdf​From IRS *Publication 463*:
> ...


I think you and Mears Troll Number 4 are saying the same thing- namely that you can deduct for tolls and parking in addition to the SMR deduction. He could have said it does not "include tolls" instead of "cover tolls" and his intent would have been clearer.


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## El Gato (Mar 5, 2016)

ahhh I see what you are saying.


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

Older Chauffeur said:


> I think you and Mears Troll Number 4 are saying the same thing- namely that you can deduct for tolls and parking in addition to the SMR deduction. He could have said it does not "include tolls" instead of "cover tolls" and his intent would have been clearer.





El Gato said:


> ahhh I see what you are saying.


I fixed it...


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## Emerald43 (Oct 21, 2016)




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