# Rideshare taxes: Uber, Lyft, Sidecar, Taxes 1099 SCHD C and NOLs Mileage



## Randy Shear




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## Sheldon

Thank you for the informative video! I thought that due to my car being low-end luxury, gas prices so high and all the maintainance I've had to invest in to ensure the car lasts, that I would have spent more than the +- 56 cents per mile allotted..........But after your breakdown in the video I'm not so sure anymore.

I started driving in June I wonder if it's too late to go back and log/calculate mileage to the extent it would be evident enough for deduction use?

I guess I found it personally easier to file away (and photograph) every receipt for monies spent on fuel and maintainance and other business expenses rather than logging miles because my car is mixed use. While I dont exactly have a major driving social personal life, my rough guess would be that 20% of my miles are not uber related in any way and the thought of logging everything to sort it out pains me.

I also save the less obvious receipts for whatever comforts I offer riders, some of which may or may not be deductible....


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## Randy Shear

I'm here to help. Thanks for watching.


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## Emmes

How was business last night, Randy? I decided to stay in, but I'm ready to get out there and make some money today and tomorrow morning.


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## Randy Shear

Emmes said:


> How was business last night, Randy? I decided to stay in, but I'm ready to get out there and make some money today and tomorrow morning.


I just got home, but I fell asleep and didn't get to Indy until 11PM. I think I gave up at 3:30AM. Then a poor girl / young woman from Tennessee was lost, trying to walk to Indiana University from downtown with luggage. I drove her for free, told her to be careful out there. It's very dangerous. With tips: $80  ugh.


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## Emmes

Damn. I was hoping business would be better than that!
Uber sent me a text message saying downtown was "booming",
but that was around 5pm.
Trying to walk from downtown to IU??? Seriously?!! 
My gosh. I'm glad you were there to take her. 
I certainly would have, too.


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## UberRey

Are all the miles that you drive while on the clock tax deductible, or only the miles that you procure with a passenger in the car. From what I could gather from your video, it's every mile? 

Another question... Do you possess a business license as a sole proprietor? Is it required? What about forming an LLC? Obvious protections there, but I don't know ab0out which is better for you come tax day. Thanks for the info that you've shared. Very helpful. I was starting to freak out that after taxes, Uber was going to end up costing me. You gave me hope.


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## Randy Shear

UberRey said:


> Are all the miles that you drive while on the clock tax deductible, or only the miles that you procure with a passenger in the car. From what I could gather from your video, it's every mile?
> 
> Another question... Do you possess a business license as a sole proprietor? Is it required? What about forming an LLC? Obvious protections there, but I don't know ab0out which is better for you come tax day. Thanks for the info that you've shared. Very helpful. I was starting to freak out that after taxes, Uber was going to end up costing me. You gave me hope.


1) If you are out with the app on, looking for "pings" the mileage counts.
2) I do have a federal tax ID # or EIN (employment identification number). It is not required, you can just as well use your SS #
3) I have never looked in to an LLC, although I agree there would be a TON of asset protection in doing so. I should probably dig in to that.

Thanks!


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## uberdriver

Sheldon said:


> I started driving in June I wonder if it's too late to go back and log/calculate mileage to the extent it would be evident enough for deduction use?
> 
> I guess I found it personally easier to file away (and photograph) every receipt for monies spent on fuel and maintainance and other business expenses rather than logging miles because my car is mixed use. While I dont exactly have a major driving social personal life, my rough guess would be that 20% of my miles are not uber related in any way and the thought of logging everything to sort it out pains me.


I am not sure that I understand what you are getting to. You think that because you were planning to use actual car expenses you do not need to have a mileage log ? Unless you could PROVE to the IRS that the vehicle is 100% used for business, I think that the IRS REQUIRES you to keep a mileage log of every personal versus business trip of the car. The IRS will not accept deductions based on "my rough guess would be that 20% of my miles are not uber related". So you better start keeping a detailed mileage log from now on of every business versus personal use of your car, whether you finally end up using the standard mileage allowance of $0.56 per mile or actual expenses.

I think that if you go out of your home for a few hours of uninterrupted Uber driving (no personal driving in between), you could aggregate all those hours as a single "business trip" and just record the mileage when you start the shift and when you end it. No need to record mileage of every single Uber fare. Of course, I am not a tax advisor, and any opinion expressed here could be wrong and thus use it at your own risk, blah, blah (lawyers' bullshit language).


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## uberdriver

John W said:


> Just a point, since the vehicle is a "vehicle for hire" the standard mileage DOES NOT apply. You MUST use the actual expenses based on the percentage between the business and personal mileage of the vehicle..
> Didn't answer whether you are operating under a business license?


I think you are wrong, in the present. Some time ago (a few years I think), that IRS rule changed. Now taxicabs and similar vehicle for hire businesses can choose whether to use actual expenses or standard mileage. Your statement was correct before that change occurred. Of course, I am not a tax advisor, and any opinion expressed here could be wrong and thus use it at your own risk, blah, blah (lawyers' bullshit language).


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## Randy Shear

*http://www.biztaxadvisor.com/irs-mileage.html*


*1) The Actual Car Expense Method*
When using this method to figure your car expenses you use, as the name suggests, actual expenses. You keep records of gas, lube, oil, repairs, tires insurance, auto insurance, auto loan interest and/or lease payments. You also need to figure the depreciation expense of your vehicle, or your accountant can do it for you. You also keep a mileage log of business miles driven. At the end of the year, you divide your business miles by total miles driven. The resulting number is your business use percentage. You then multiply the business use percentage with your actual expenses to figure your car expense deducion. Sounds complicated? Don't worry if you don't get it right away, I'll show you an example in a link later on that should make it easy to understand. For now, keep in mind that the Actual Car Expense Method requires you to keep accurate records of all your car expenses as well as a record of your IRS mileage.
*2) The Standard IRS Mileage Method*
When using the Standard IRS Mileage method to figure your car deduction, you simply multiply the total number of business miles with the standard IRS mileage rate for that year. Again, see the link in the first paragraph on this page for more information about the standard IRS mileage method as well as the IRS mileage rate for the past several years.
*Standard IRS Mileage or Actual Expenses?*
Here are a few reasons the standard IRS mileage method is preferred by many of those who qualify for it:

The IRS mileage method saves time and is much easier to use, as less recordkeeping is involved.
Accountants and tax pros like the IRS mileage method (less work for them!).
Standard IRS mileage is easier to estimate, if records are missing. It is also easier to defend if your return is audited by the IRS.
Sometimes, if expense receipts are missing, using the IRS mileage method results in a higher tax deduction.
*Do you qualify for using the Standard IRS Mileage Method?*
Looking at the advantages that the standard IRS mileage method offers, you would think that everyone would be using it. Then, why aren't they? Firstly, some people, especially those keeping meticulous records, sometimes get a higher deduction using the actual expense method. More importantly, however, not everyone everyone qualifies for the IRS mileage method. You may _not_ use the IRS mileage method if:

You depreciated your car on a previous years tax return using the MACRS or Section 179 methods.
You use more than four vehicle for business _at the same time_.
*Note: Prior to January 2011, taxpayers who used their vehicle for hire, e.g., a taxi cab, were precluded from using the standard IRS mileage method. This is no longer the case.*
*Standard IRS Mileage vs. Actual Expenses - Still Not Sure Which One to Choose?*
If you find that after reading the information above you find it difficult to determine whether you should use the standard IRS mileage method or the actual expense method, I have prepared a couple of "real life" examples that might make the concepts easier to to grasp. To avoid crowding this web page, I've created another page for the examples. To view the examples, follow this link: Standard IRS Mileage Examples. Even if you feel you have a good understanding of the methods as explained on this page, the page with the examples also contains some valuable time saving tips for using the standard mileage method (Example 2), so it might still be worth your time reading it.
*Conclusion about the Standard IRS Mileage Method*
If you reviewed the two IRS mileage examples in the link above, you see that the best method to choose depends on people's different circumstances. I often hear people say: "I always use the standard IRS mileage method." or "I never use the IRS mileage method - Actual Expenses always give a higher deduction!" Remember that people usually talk out of their own experience, and that what is the best choice for them might not be the best choice for you.
The truth is that only you know whether or not the IRS mileage method makes sense to you. If you are super organized and have all expense receipts, using the actual expense method can result in a higher auto tax expense deduction. This might be especially true if your vehichle has a high value and you are getting to deduct an accelerated depreciation value for the first few years you are using the vehicle for business. Keep in mind, however, that once that depreciation has been taken, the total actual expenses for future years will probably be less than if you were using the IRS standard mileage method. Also, if you spent a huge amount on, say, car repairs in a given year, the IRS mileage rate might not be fully compensate you for those expenses, and using the actual method might result in a higher tax detuction.
I admit that my bias is toward using the IRS mileage rate. This is probably due to my experiences with helping clients and friends with their taxes over the years. Just remember that even if you are very organized, using actual expenses can be much more cumbersome and difficult to defend in an IRS audit scenario than if you had used IRS mileage. For many business owners, it is acceptable to forego a few dollars on their tax deduction by using the IRS mileage rate if it means knowing that they would better able to defend that deduction in an IRS audit.
Hopefully, you've found this information helpful in making the right decision for you whether to use the IRS mileage rate or actual auto expense methods to claim your auto tax deduction.


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## Randy Shear

John W said:


> Just a point, since the vehicle is a "vehicle for hire" the standard mileage DOES NOT apply. You MUST use the actual expenses based on the percentage between the business and personal mileage of the vehicle..
> Didn't answer whether you are operating under a business license?


Please, don't post information that you don't know the facts on. No information (not posting) is far better than false information. You really wanted to drive home that false info... "DOES NOT" "MUST" Errrrr.

I'm really not sure why you are on this forum. You're not a driver, you're not a rider, your "experience" as a cab driver is obviously outdated (as per your "point" regarding tax law, that expired 4 years ago). I can't find much of anything positive that you are contributing to this community. Before I post "facts", I research several sources, as I don't want to mislead this community. That's not to say at some point I may post incorrect information, but researching several sources first definitely helps me to not post false info as factual. Try Google sometime.
*
Note: Prior to January 2011, taxpayers who used their vehicle for hire, e.g., a taxi cab, were precluded from using the standard IRS mileage method. This is no longer the case.
*
I'm certain your prior experience as a cab driver could benefit people on this forum, if you asserted yourself in a positive manner. You seem 100% against Uber. With that kind of closed-minded mentality, you have nothing but negativity to contribute to the forum. Try being a little more open-minded.


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## Grace A.

Mileage seems to be the most logical way for me to calculate the cost of a mixed use vehicle. Even if I did expenses and depreciation I would still need to know my business vs personal miles to determine the %age of each.


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## Randy Shear

John W said:


> Ahh I'm so sorry I hurt your feelings.
> But you better check that just called my accountant... Same rules apply for vehicles for hire.
> Oh well good luck with that..


Is your accountant as outdated in tax law as you? If your accountant told you this, you need a new one lol. Otherwise (and more likely) you sir, are a flat out liar.

STOP POSTING MISINFORMATION ON THIS FORUM

This is from Intuit (tax professional enough for you?)

https://ttlc.intuit.com/questions/2561815-uber-driver-questions

*Uber driver questions*
I just started working part-time as a driver for Uber, a ride-sharing program. My first check did not appear to have any federal or local tax deduction. This sparked a bunch of questions for me:

What percentage should I be withholding to pay in taxes?
Do I have to file quarterly tax reports, as a self-employed person in a part-time role?
What expenses are deductible? Mileage? Fuel costs? Monthly car payment? Car maintenance? Cell phone? Food?
At the root of all of this is - what should I be recording and tracking? Did I just get in over my head?

self-employment (schedule c), vehicle deductions, illinois, mileage, deductions, costs, payment, withholding
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TomYoung 
SuperUser
2 months ago
You are not an "employee" of Uber, you are an "independent contractor". As such, there is no withhholding of any taxes from your checks; you are responsible for all taxes - Self Employment taxes and income taxes - on your net earnings. Uber spells this out, sort of, on their site:
"You pay taxes as an individual-there's no need to register as a business. File taxes as you normally would, and we'll send you a 1099 form that you will use to report the income you made driving with Uber."
You will report your net income from your Uber activitiy, (i.e., what you are paid minus any associated expenses), on Schedule C and the Schedule C "bottom line" will show up on line 12 of your Form 1040. ("Business income or (loss). Attach Schedule C or C-EZ".)
The net income from your Uber activity is subject to Self Employment taxes, (Social Security and Medicare), at approximately a 15% rate. You will get to deduct one-half of these Self Employment taxes on line on line 27 of your Form 1040. ("Deductible part of self-employment tax. Attach Schedule SE".) The net income from your Uber activity minus the one-half of the Self Employment taxes deducted will then be added to all your other "ordinary" income and is subject to income taxes at ordinary income rates.
"What percentage should I be withholding to pay in taxes?"
YOU don't "withhold" taxes, it's only the PAYER of income that withholds taxes, and Uber is not withholding any taxes on the checks they send you. In a situation where a person earns income that is not subject to withholding - which is the case here - it MAY be necessary to send checks ("Estimated Taxes") to the Treasury on a quarterly basis.
"Do I have to file quarterly tax reports, as a self-employed person in a part-time role?"
There is no "reporting" - in the sense of reporting income and deductions - on a quarterly basis but it MAY BE necessary to send in Estimated Taxes on a quarterly basis. I say "MAY BE necessary" because that depends entirely on your own situation. If you have income from sources where taxes ARE withheld then it's probably not necessary to pay estimated taxes as long as sufficient taxes are withheld so that you are not in an "underpaid" situation when you file your income tax return. TurboTax has a brief explanation of all this here https://turbotax.intuit.com/tax-tools/tax-tips/Self-Employment-Taxes/How-to-Withhold-Your-Own-Taxes/...
"What expenses are deductible? Mileage? Fuel costs? Monthly car payment? Car maintenance? Cell phone? Food?"
*In a situation where you are using your personal car for business you typically can deduct either "actual" costs for the percentage of business use, (though cell phone and food probably are not pertinent) or you can deduct mileage at a standard rate for business use. Unless the vast majority of car use is Uber related I'd probably opt for mileage as it's so much simpler.*
"At the root of all of this is - what should I be recording and tracking? Did I just get in over my head?"
Assuming you have good personal records of your expenses I'd say you'd want to maintain a log of Uber activities - date, time and place of pickup and drop off and associated miles. If you go the "simple" route and deduct mileage instead of "actual" expenses your Schedule C would consist of exactly 2 lines so it's not very hard.
Tom Young


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## Grace A.

John W said:


> Keep a mileage log


I use MyLog on my phone. It tracks mileage as soon as it syncs with my bluetooth and at the end I flag the trip as business or personal.


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## Randy Shear

John W said:


> Keep a mileage log


Really? Who would have thought to keep a log?? This is about the only useful, and truthful information you have posted on this forum.


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## Randy Shear

John W said:


> B
> 
> Nope my drivers put in more than 150,000 per year... Sorry IRS would not give us the standard deduction of 65-cents per mile. I personally would love it.. Would be $97,500 deduction... They didn't like that..
> There something constructive... To start my Monday morning hahaha..


I see you recanted your "my accountant told me" statement. Good thing I replied to it so everyone can see how you spread lies around here. As I've said before, your experience years ago as a cabbie, does not apply today, nor to our rideshare business. If you don't know what you're talking about, please do the forum a favor, and keep quiet.


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## Emmes

How about you both IGNORE each other? Problem solved. 
One of you claims the mileage, the other doesn't. Who cares who's right?

Be a positive influence in the thread or take your negativity elsewhere.


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## Randy Shear

John W said:


> Whatever the IRS and my accountant... Say the same exact thing.
> It does apply today because I am still in transportation just a different area of it..
> You want to shut me up.. Why don't you make me..


Big man talking trash on the other side of the country. You're what? 58? Taunting a 34 year old from a keyboard? Grow up. I never TOLD you to shut up. I sad "If you don't know what you're talking about, please do the forum a favor, and keep quiet." Note the PLEASE, and BE QUIET. No command, and I never said shut up.

I've posted PROOF from multiple sources, including direct links. Where is your proof? Talk is cheap partner. Back it up.


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## Randy Shear

Emmes said:


> How about you both IGNORE each other? Problem solved.
> One of you claims the mileage, the other doesn't. Who cares who's right?
> 
> Be a positive influence in the thread or take your negativity elsewhere.


This man contradicts almost everything, everyone in this forum threads, or replies. You can't ignore him, when he is all over the forum, posting misinformation to unsuspecting drivers.


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## Emmes

I just did ignore him. Won't matter where he posts, I won't see it.
Others have (or will) follow suit when they get tired of reading it.

My eyes hurt already and it's not even noon!


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## Randy Shear

Emmes said:


> I just did ignore him. Won't matter where he posts, I won't see it.
> Others have (or will) follow suit when they get tired of reading it.
> 
> My eyes hurt already and it's not even noon!


Ignore him how?? I'm confused.. I'd LOVE to block him.


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## Emmes

Randy Shear said:


> Ignore him how?? I'm confused.. I'd LOVE to block him.


Click his name, profile pops up .. click IGNORE (=block). Works swimmingly.  
I only see "show ignored content". Nah, I'll pass.


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## Randy Shear

Emmes said:


> Click his name, profile pops up .. click IGNORE (=block). Works swimmingly.
> I only see "show ignored content". Nah, I'll pass.


I DID IT!!!!! YES!!!! Thank you sosososososo much.


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## Emmes

ha ha ha .. welcome!!


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## Alexander

Hey Randy- thanks so much for making that video and for posting info about the tax question. I am just getting started driving, so I will definitely be keeping a log of my miles. If I understand things correctly so far, in the event that I, say, drive 100 miles one day, 75 of which were for Uber, while the remaining 25 were for my lunch break and/or maybe running personal errands, then of those 100 miles that day I can only claim 75 as a business expense, right?

Similarly for deducting the price of a vehicle purchased for Uber, if I bought the car for, say, $20,000, with monthly payments of $400, then do I deduct only the number of payments multiplied by $400 that I have made for that tax year, or do I deduct the entire $20,000, assuming that the car is used exclusively for Uber? Lastly, if I purchased the car only PARTLY for Uber, and use it only PARTLY for Uber (e.g., say I use it half for Uber, half for personal stuff), then would that mean that I am only able to deduct half of the car price and/or half of the monthly car payment on my taxes (along with, of course, the corresponding maintenance expense mentioned above that includes business miles using either the standard deduction or actual expense method)?

Thanks again for the great info! Stay safe on the roads.


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## Desert Driver

Sheldon said:


> Thank you for the informative video! I thought that due to my car being low-end luxury, gas prices so high and all the maintainance I've had to invest in to ensure the car lasts, that I would have spent more than the +- 56 cents per mile allotted..........But after your breakdown in the video I'm not so sure anymore.
> 
> I started driving in June I wonder if it's too late to go back and log/calculate mileage to the extent it would be evident enough for deduction use?
> 
> I guess I found it personally easier to file away (and photograph) every receipt for monies spent on fuel and maintainance and other business expenses rather than logging miles because my car is mixed use. While I dont exactly have a major driving social personal life, my rough guess would be that 20% of my miles are not uber related in any way and the thought of logging everything to sort it out pains me.
> 
> I also save the less obvious receipts for whatever comforts I offer riders, some of which may or may not be deductible....


Sheldon - I paid $18.5K for my car new back in '06. I have logged and expensed every mile on it as I run a couple businesses that require a lot of travel. I now have just shy of 145K miles on it. That means I have taken expenses against my taxes to the tune of more than $70K on a car that I paid less than $20K for new. And it certainly hasn't cost me $70K to operate it. The best part is, this is all legal and totally above board. Once you get in the habit of logging your miles, it becomes second nature. My accountant never has a problem taking approximately $10K a year in expenses off my income because of my mileage logs. Never been audited, but I'm certainly ready if that day ever comes.


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## Alexander

Desert Driver said:


> Sheldon - I paid $18.5K for my car new back in '06. I have logged and expensed every mile on it as I run a couple businesses that require a lot of travel. I now have just shy of 145K miles on it. That means I have taken expenses against my taxes to the tune of more than $70K on a car that I paid less than $20K for new. And it certainly hasn't cost me $70K to operate it. The best part is, this is all legal and totally above board. Once you get in the habit of logging your miles, it becomes second nature. My accountant never has a problem taking approximately $10K a year in expenses off my income because of my mileage logs. Never been audited, but I'm certainly ready if that day ever comes.


Hey Desert, did you use any of the car price as an expense, or if you bought the car not just for business purposes, did you use part of the price as an expense (along with logging the mileage for business as an expense on top of that)?


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## Older Chauffeur

Alexander,
We'll see what Randy says, but my understanding is that you choose one method or the other for ALL car expenses. If you use the standard mileage deduction it includes the cost of the vehicle in the form of depreciation, rather than the amount of the monthly payment. If you choose to use the actual expenses, the vehicle value would be depreciated over a set period, whether you financed it or paid cash. You would be able to deduct the loan interest, AFAIK. I think a monthly payment only becomes deductible if you lease the vehicle, in which case the business use percentage would be deductible. I've been chauffeuring as an independent contractor for twelve years, using four different vehicles, and find the standard mileage deduction suits me best. I keep a detailed mileage log of business use, although mine is for traveling to clients' homes as I drive them in their own vehicles.
Disclosure: I'm not a tax professional, nor do I play one on TV. I do use a CPA, however.


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## BlueRooftop

Desert Driver said:


> Sheldon - I paid $18.5K for my car new back in '06. I have logged and expensed every mile on it as I run a couple businesses that require a lot of travel. I now have just shy of 145K miles on it. That means I have taken expenses against my taxes to the tune of more than $70K on a car that I paid less than $20K for new. And it certainly hasn't cost me $70K to operate it. The best part is, this is all legal and totally above board. Once you get in the habit of logging your miles, it becomes second nature. My accountant never has a problem taking approximately $10K a year in expenses off my income because of my mileage logs. Never been audited, but I'm certainly ready if that day ever comes.


Similarly, I previously worked for somewhere I had to log my mileage. Because it was a state government agency I could've filed for mileage reimbursement at the state level (.46 per mile) but opted to file tax time for federal mileage (higher at ~.56 per mile at the time). I kept clear records though and was always confident turning it in. Basically I used an excel sheet which documented date, starting location, end location, beginning odometer, end odometer, start time, arrival time, Miles, and vicinity miles....then added up the mileage at the bottom. Kept them together by the month. Easily got back $500 per month if turned in to my state agency, but opted to file it thru end of the year taxes. Turned in my mileage records and never had an issue.


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## Alexander

Older Chauffeur said:


> Alexander,
> We'll see what Randy says, but my understanding is that you choose one method or the other for ALL car expenses. If you use the standard mileage deduction it includes the cost of the vehicle in the form of depreciation, rather than the amount of the monthly payment. If you choose to use the actual expenses, the vehicle value would be depreciated over a set period, whether you financed it or paid cash. You would be able to deduct the loan interest, AFAIK. I think a monthly payment only becomes deductible if you lease the vehicle, in which case the business use percentage would be deductible. I've been chauffeuring as an independent contractor for twelve years, using four different vehicles, and find the standard mileage deduction suits me best. I keep a detailed mileage log of business use, although mine is for traveling to clients' homes as I drive them in their own vehicles.
> Disclosure: I'm not a tax professional, nor do I play one on TV. I do use a CPA, however.


Thanks, Older- if that's the case, it simplifies things since the standard deduction obviates the need to worry about car price/monthly payment deduction.


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## Tristan Zier

Hey all - we have a good guide for expenses you can write off (including the difference between the Standard Mileage Rate and Actual Costs Method, cell phones, snacks, etc) plus tax forms you need to know about. I can't post links (sorry!), but google Zen99 then check out Zen99 University (the guide is at the top).

Happy to dive into any expenses further if people have questions. I was formerly a CPA and now am creating software to help make life easier for independent contractors (starting with taxes and health insurance).


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## DjTim

Tristan Zier said:


> Hey all - we have a good guide for expenses you can write off (including the difference between the Standard Mileage Rate and Actual Costs Method, cell phones, snacks, etc) plus tax forms you need to know about. I can't post links (sorry!), but google Zen99 then check out Zen99 University (the guide is at the top).
> 
> Happy to dive into any expenses further if people have questions. I was formerly a CPA and now am creating software to help make life easier for independent contractors (starting with taxes and health insurance).


Well....


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## Desert Driver

Tristan Zier said:


> Hey all - we have a good guide for expenses you can write off (including the difference between the Standard Mileage Rate and Actual Costs Method, cell phones, snacks, etc) plus tax forms you need to know about. I can't post links (sorry!), but google Zen99 then check out Zen99 University (the guide is at the top).
> 
> Happy to dive into any expenses further if people have questions. I was formerly a CPA and now am creating software to help make life easier for independent contractors (starting with taxes and health insurance).


Excellent comment, Tristan. And best of luck on your software development efforts. Any Uber driver who fails to take the IRS-allowed 55.5 cents per mile as a deduction is simply leaving money on the table needlessly. I bought my 2007 Honda Fit for $18,500. And by using the IRS allowed mileage rate over the years I have been able to legally and legitimately expense in excess of $70K for the nearly 150K miles I've put on my personal car for business. I'm looking forward to more comments and contributions from you on Uber People.


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## Nick781

So do you write down everywhere you go? or how do you estimate to prove to taxes you drove somewhere


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## Desert Driver

Nick781 said:


> So do you write down everywhere you go? or how do you estimate to prove to taxes you drove somewhere


Just keep a daily log in your car, then plug the values into a spreadsheet. So far this year I have 16k miles in my log. Yes, I use the car for personal use, too, but it's easy to bury those miles in my logs. Once you get in the habit, it takes 10 seconds when you get in the car in the morning.


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## Nick781

Desert Driver said:


> Just keep a daily log in your car, then plug the values into a spreadsheet. So far this year I have 16k miles in my log. Yes, I use the car for personal use, too, but it's easy to bury those miles in my logs. Once you get in the habit, it takes 10 seconds when you get in the car in the morning.


Technically commuting to work does not count as a deductible mileage? has IRS ever questioned your miles or wanted to see records


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## Desert Driver

Nick781 said:


> Technically commuting to work does not count as a deductible mileage? has IRS ever questioned your miles or wanted to see records


Excellent point and question. No, never been challenged. Here are the statistics. My household income is under $150k. My chances of being audited by the US are 1 in 40,000. Plus, I use my car daily to visit clients and drive for ridesharing. So, daily mileage logs would survive an audit. My tax accountant is crazy accurate and a stickler for the rules, and she says my logs would hold up in any audit. It's all about documentation. My odometer tonight reads 146,586. Every one of those miles has been expensed since I bought the car in October 2006.


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## Nick781

So I did some more reading and I guess we have to document how many miles we drove for personal uses aside from driving for uber. Does anyone have the link to the IRS spreadshit for mileage logs


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## Desert Driver

Nick781 said:


> So I did some more reading and I guess we have to document how many miles we drove for personal uses aside from driving for uber. Does anyone have the link to the IRS spreadshit for mileage logs


The easiest thing for you to do, Nick, is to simply keep a log that shows date, beginning odometer, ending odometer for each Uber/Lyft driving session. I use a small spiral bound notebook that stays in the pocket in the driver's door. If you use your personal vehicle for other work trips (other than going to and from work) you can log those miles, too. In my case. I office out of my house, so I log every mile when I drive to a client, drive to a vendor, drive to a meeting, or drive for Uber/Lyft. And if I make a trip to the grocery store or pick up my kids at school, those miles just conveniently find their way into my log, too. The IRS isn't going to bust your chops for a few hundred "soft" miles.
According to the DOE, it costs me 26 cents per mile to operate my '07 Honda Fit. So far, I have expensed $75K against the car. Therefore, I have profited to the tune of about $37K on my car over the course of 150K miles. This is one of the few tax breaks a guy like me gets, but it only really works if you drive an econobox. This would never work with my 'Stang GT that burns premium and gets 14 MPG on good day.


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## Desert Driver

Would it help if I posted a page from my mileage log so everyone can see how I do it and how my tax accountant wants to see my miles documented?


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## Desert Driver

Randy Shear said:


> 1) If you are out with the app on, looking for "pings" the mileage counts.
> 2) I do have a federal tax ID # or EIN (employment identification number). It is not required, you can just as well use your SS #
> 3) I have never looked in to an LLC, although I agree there would be a TON of asset protection in doing so. I should probably dig in to that.
> 
> Thanks!


I have two LLCs for my companies. I have Uber pay me as an LLC contractor and the direct deposit goes to the account of my consulting company.


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## Nick781

Desert Driver said:


> Would it help if I posted a page from my mileage log so everyone can see how I do it and how my tax accountant wants to see my miles documented?


That would be awesome! if you dont mind.


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## Nick781

I started fares already without documenting this past week,


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## Simon

I know I'm bumping an old tgread... but does anyone have irs link to the elimination of the taxi li cab exception for milage write off....


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## Tristan Zier

Simon said:


> I know I'm bumping an old tgread... but does anyone have irs link to the elimination of the taxi li cab exception for milage write off....


http://www.irs.gov/publications/p463/ch04.html#en_US_2013_publink100033935

"You can elect to use the standard mileage rate if you used a car for hire (such as a taxi) unless the standard mileage rate is otherwise not allowed, as discussed above."

Not allowed when:
* Use five or more cars at the same time (such as in fleet operations),
* Claimed a depreciation deduction for the car using any method other than straight line, for example, MACRS (as discussed later under Depreciation Deduction),
* Claimed a section 179 deduction (discussed later) on the car,
* Claimed the special depreciation allowance on the car,
* Claimed actual car expenses after 1997 for a car you leased, or
* Are a rural mail carrier who received a qualified reimbursement. (See Rural mail carriers , earlier.)


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## Tristan Zier

For those interested, we now have blog posts on how to read your Uber 1099 and Lyft 1099:

********************/blog_posts/read-uber-1099
********************/blog_posts/lyft-1099


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