# If you pay any taxes on your uber earnings,,,get a different accountant



## Dave Bust (Jun 28, 2017)

there are many additional write offs that you may be missing

your total uber miles plus the additional miles you drive with the uber app on.

miles driven with the uber app off is considered your commute to work.

car washes, car cleaners, water, candy or mints, cleaning supplies, car registration, insurance, depreciation, even those bottles of fabreez 

Car maintenance and gas is not written off if you take the standard mileage deduction, it is one or the other

car accident repairs are deductible.

car improvements are deductible as well

i'll try to answer any other questions you have.

If you have any other ideas please post here.


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## theMezz (Sep 29, 2018)

An accountant that admittedly is not a tax specialist told me we cannot deduct cell phone bill unless it is _100%_ used for ride share. He did say to ask a tax specialist.

Some people that deduct a % of the bill - but he thinks that is an improper deduction.

Thanks for posting - I myself wanted to know if we can deduct gas AND mileage and I thought not. So you did answer one of my questions.

Personally I will skip the cell phone deduction - it wouldn't be a big deduction (for me) anyway and I do not want to rock the tax boat !


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## vtcomics (Oct 9, 2018)

Dave Bust said:


> there are many additional write offs that you may be missing
> 
> your total uber miles plus the additional miles you drive with the uber app on.
> 
> ...


Here's a question that's never been asked here.....does the Uber mileage reported.on the tax stuff they send out have all "on app" miles? Or just miles with a pax? Asking for a friend.


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## BCS DRIVER (Oct 25, 2018)

Meals. 50% deduction for the cost of it. I think the maximum daily amount is $25, after the 50%. Must keep receipts.

I've "heard" that it tracks all miles. If they do there's 2 big problems. 1st is do you really trust U/L to get anything right. 2nd is using their number will bite you in the ass if the IRS does an audit.


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## SamuelB (Aug 29, 2018)

BCS DRIVER said:


> Meals. 50% deduction for the cost of it. I think the maximum daily amount is $25, after the 50%. Must keep receipts.
> 
> I've "heard" that it tracks all miles. If they do there's 2 big problems. 1st is do you really trust U/L to get anything right. 2nd is using their number will bite you in the ass if the IRS does an audit.


You are thinking of meals during business travel. Meals during your workday are not deductible.
"Question: For business travel, are there limits on the amounts deductible for meals?
Answer

Meal expenses are deductible if your business trip is overnight or long enough that you need to stop for substantial sleep or rest to properly perform your duties. Meal expenses are also deductible if the meal is business-related entertainment."
https://www.irs.gov/faqs/small-busi...er-business/income-expenses/income-expenses-2
*The Three Types of Tax-Deductible Meals*
Here are the three general types of meal expenses that a business owner should track in order to qualify for a tax deduction.

*1. Meals Discussing Business With Someone Else*
Dining expenses are always a write-off when discussing business with a partner, client, vendor or even a potential client. Make sure to record all expenses including tips, food and the bar tab. Remember, however, that all dining and entertainment deductions are still limited to *50% of the full amount*. Your accountant will make this adjustment on the tax return when it's prepared.

*2. Meals by Yourself While Traveling for Business*
Another overlooked write-off is dining by yourself when you are traveling. This "traveling/dining" deduction has been defined as times when the taxpayer is doing business outside of their normal commute or normal business location. Again, this is limited to 50%.

*3. Events or Food Provided in the Workplace*
*https://quickbooks.intuit.com/r/taxes/how-to-maximize-your-meals-and-entertainment-tax-deductions/*

If you have information that says IC/Sole proprietor can deduct meals as part of their normal workday I would be interested in seeing it.



theMezz said:


> An accountant that admittedly is not a tax specialist told me we cannot deduct cell phone bill unless it is _100%_ used for ride share. He did say to ask a tax specialist.
> 
> Some people that deduct a % of the bill - but he thinks that is an improper deduction.
> 
> ...


You most certainly can deduct your business use of your cell phone. I will be writing off $623 which is not chump change.

* cellphone as a small business deduction*
If you're self-employed and you use your cellphone for business, you can claim the business use of your phone as a tax deduction. If 30 percent of your time on the phone is spent on business, you could legitimately deduct 30 percent of your phone bill. In "Entrepreneur" magazine, writer Kristin Edelhauser recommends getting an itemized phone bill, so you can measure your business and personal use and prove your deduction to the IRS. Alternatively, you could get a second phone number and use it exclusively for business.
https://turbotax.intuit.com/tax-tip...s-be-tax-deductible-with-a-business/L6NQvycMO


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## oldfart (Dec 22, 2017)

I claim a home office deduction. (Yes I have a room dedicated to my office) I know that that’s a stretch but I operate under an LLC and I do private rides.so I do manage the advertising from there, send invoices and make phone calls. The advertising is a deduction too


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## SamuelB (Aug 29, 2018)

Remember you have to choose between actual expenses vs standard mileage rate. If you use actual expenses the first year the car was put in service then you have to stick with that method in subsequent years. If you use standard mileage rate the first year you can then switch in subsequent years. If you use standard mileage pretty much everything auto related is covered by that. This list is the basic list of actual expenses. The starred items can be deducted if you use the standard mileage rate:

Gas and oil
Maintenance and repairs
Tires
Registration fees and taxes*
Licenses
Vehicle loan interest*
Insurance
Rental or lease payments
Depreciation
Garage rent
Tolls and parking fees*
*Also deductible if you choose the standard mileage method.



oldfart said:


> I claim a home office deduction. (Yes I have a room dedicated to my office) I know that that's a stretch but I operate under an LLC and I do private rides.so I do manage the advertising from there, send invoices and make phone calls. The advertising is a deduction too


The rules regarding home office are such BS. The only way to claim principal place of business is to claim home office deduction. We have a desk area in a closet of a room. Screw it! I am claiming it. All of my income is IC and it is ridiculous the amount of time I spend with securing jobs, cleaning and maintaining my, car and preparing it for work; accounting, taxes and on and on, that they wouldn't consider my home my prinicpal place of business and consider travel from home to my first work location as commuting.


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## vtcomics (Oct 9, 2018)

BCS DRIVER said:


> Meals. 50% deduction for the cost of it. I think the maximum daily amount is $25, after the 50%. Must keep receipts.
> 
> I've "heard" that it tracks all miles. If they do there's 2 big problems. 1st is do you really trust U/L to get anything right. 2nd is using their number will bite you in the ass if the IRS does an audit.


Yup; which is why meticulous line by line recording of each individual trip including dead miles is the only sure-fire audit "insurance policy". Yes; you may never get audited and all this record keeping seems unnecessary. But when you get that letter from the IRS I can assure you it is a living nightmare; UNLESS you have kick-ass records. Then you just smile and give the auditor the piles of data. Another tidbit of info: IRS debt is NOT dischargeable in bankruptcy court, so forget about that Ace in the hole. That debt stays with you forever; to your grave.


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## BCS DRIVER (Oct 25, 2018)

*


SamuelB said:



This "traveling/dining" deduction has been defined as times when the taxpayer is doing business outside of their normal commute or normal business location.

Click to expand...

*
Drivers do not commute if they are doing strictly rideshare. As to the "normal business location" that's a little bit murky. No clear definition on that. Does it pertain to a specified radius around their "normal" place of business such as an office building? The city or state you do business in?

With no clear definition of normal business location I'll go with my opinion until told otherwise by a tax professional or the IRS. And if that so happens I'll say show me that in writing because otherwise it's their opinion being stated.
*

Traveling*

The IRS also allows independent contractors to deduct meals as a business expense when traveling to conduct business. If you are traveling to do business with a client, you can deduct half of your meal expenses from the trip, including taxes and tips.

https://smallbusiness.chron.com/can-independent-contractor-deduct-meal-expenses-25751.html

Would driving (traveling) to locations to get a ping, pick up a rider, or transport a rider to their destination be traveling to do business with a client? I think yes. Again, until or unless shown this in writing I'll continue.


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## SamuelB (Aug 29, 2018)

BCS DRIVER said:


> Drivers do not commute if they are doing strictly rideshare. As to the "normal business location" that's a little bit murky. No clear definition on that. Does it pertain to a specified radius around their "normal" place of business such as an office building? The city or state you do business in?
> 
> With no clear definition of normal business location I'll go with my opinion until told otherwise by a tax professional or the IRS. And if that so happens I'll say show me that in writing because otherwise it's their opinion being stated.
> *
> ...


The whole thing revolves around business travel. The key from what you posted is: "traveling to conduct business."
I refer you back to what I posted directly from the IRS that defines what travel business is: "Meal expenses are deductible if your business trip is overnight or long enough that you need to stop for substantial sleep or rest to properly perform your duties" When you are returning to your home after work every day I don't see how you justify it as business travel. You are also not dining with your clients. Business meals require you dine with clients. Meals alone, *while you are traveling* are deductible.


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## BCS DRIVER (Oct 25, 2018)

SamuelB said:


> The whole thing revolves around business travel. The key from what you posted is: "traveling to conduct business."
> I refer you back to what I posted directly from the IRS that defines what travel business is: "Meal expenses are deductible if your business trip is overnight or long enough that you need to stop for substantial sleep or rest to properly perform your duties" When you are returning to your home after work every day I don't see how you justify it as business travel. You are also not dining with your clients. Business meals require you dine with clients. Meals alone, *while you are traveling* are deductible.


"or long enough that you need to stop for substantial sleep *or rest* to properly perform your duties"

The "or rest" is key here. If you've been driving 6-8-10 hours would you not agree that taking time out for a meal/rest is essential to "properly perform your duties"?



SamuelB said:


> Meals alone, *while you are traveling* are deductible


What is IRS's definition of traveling?


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## hanging in there (Oct 1, 2014)

Dave Bust said:


> there are many additional write offs that you may be missing
> 
> your total uber miles plus the additional miles you drive with the uber app on.
> 
> ...


YOU should get a different accountant.

Car accident repairs are NOT deductible.

Insurance and depreciation are included in the standard mileage deduction, you can not deduct them twice.

If you gross 100k you are going to pay taxes. Doesn't matter WHO your accountant is.


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## SamuelB (Aug 29, 2018)

BCS DRIVER said:


> "or long enough that you need to stop for substantial sleep *or rest* to properly perform your duties"
> 
> The "or rest" is key here. If you've been driving 6-8-10 hours would you not agree that taking time out for a meal/rest is essential to "properly perform your duties"?
> 
> What is IRS's definition of traveling?


I think the key test will be for any day you claim meals for traveling will be where did you sleep overnight.

It all comes down to you can get away with claiming anything you want until you don't. I think certain things get closer scrutiny like meal deductions and mileage logs. It's all a crap shoot.


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## hanging in there (Oct 1, 2014)

vtcomics said:


> Here's a question that's never been asked here.....does the Uber mileage reported.on the tax stuff they send out have all "on app" miles? Or just miles with a pax? Asking for a friend.


Uber just tells you the miles with a pax. That number is worthless.


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## Gilby (Nov 7, 2017)

I run both Uber and Lyft apps at the same time. So I track all the miles for rideshare, and do not care about what the companies report as my mileage, because as soon as I get a ping on one, I turn the other one off.


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## SEAL Team 5 (Dec 19, 2015)

*If you pay any taxes on your uber earnings,,,get a different accountant*


*Or downgrade from SUV to X.*


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## Merc7186 (Jul 8, 2017)

I am my own accountant and I pay taxes. NEVER BEEN AUDITED.

...and I really liked me.


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## daave1 (Oct 24, 2017)

Dave Bust said:


> there are many additional write offs that you may be missing
> 
> your total uber miles plus the additional miles you drive with the uber app on.
> 
> ...


If you use the standard mileage deduction, you can NOT use your car insurance as an expense.


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## Kewl-driver (Aug 24, 2018)

Dave Bust said:


> there are many additional write offs that you may be missing
> 
> your total uber miles plus the additional miles you drive with the uber app on.
> 
> ...


Get QuckBook app


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## SamuelB (Aug 29, 2018)

BCS DRIVER said:


> Drivers do not commute if they are doing strictly rideshare. As to the "normal business location" that's a little bit murky. No clear definition on that. Does it pertain to a specified radius around their "normal" place of business such as an office building? The city or state you do business in?
> 
> With no clear definition of normal business location I'll go with my opinion until told otherwise by a tax professional or the IRS. And if that so happens I'll say show me that in writing because otherwise it's their opinion being stated.
> *
> ...


Per H&R Block


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## Oscar Levant (Aug 15, 2014)

Dave Bust said:


> there are many additional write offs that you may be missing
> 
> your total uber miles plus the additional miles you drive with the uber app on.
> 
> ...


54 cents a mile just about zeros out my Income


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## FLKeys (Dec 27, 2018)

*If you pay any taxes on your uber earnings,,,get a different accountant*

I'm sure we could all find an accountant somewhere that can get our deductions high enough to off set our earnings. The question is are they legal deductions.

I owe taxes, I get every deduction I am entitled to. Shame on me for being honest. The Uber mileage rate in my market is higher than most, the problem with that is the demand is way lower than most areas. I drive smart, minimal dead miles, easy on the gas and on the brakes to minimize wear and tear. Hand record every mile I drive for rideshare.

Deduct standard mileage deduction, however also check actual expenses to see what is best.
Deduct all items purchased exclusively for ride share (additional charges, barf bags, emergency cleaning kit, etc).
Deduct all tolls paid including tolls for return trips from airport back to my area.
Deduct based on mileage percentage of use XM Radio, floor mats, seat covers, etc.
Deduct for home office space (yes it meets IRS requirements).
Deduct all Uber/Lyft fees.
Deduct all supplies purchased for record keeping (Note pads, Pens, File box, folders, envelopes for receipts, etc).
Deduct the employer-equivalent portion of your self-employment tax.
Take TCJA tax break.
Deduct percentage of use of Cellular phone bill.

That is just from he top of my head. I'd have to check my records to see if there is more.


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## vtcomics (Oct 9, 2018)

SamuelB said:


> View attachment 290240
> 
> Per H&R Block


Correct. Now I'm making some popcorn to watch the sh!t show replies rejecting these facts.


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## BCS DRIVER (Oct 25, 2018)

SamuelB said:


> View attachment 290240
> 
> Per H&R Block


I stand corrected.


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## Launchpad McQuack (Jan 8, 2019)

BCS DRIVER said:


> The "or rest" is key here. If you've been driving 6-8-10 hours would you not agree that taking time out for a meal/rest is essential to "properly perform your duties"?


It's not what I would agree to. It's what the IRS agrees to, and the IRS specifically says that this does _not_ count. This is what it says in Publication 463.

https://www.irs.gov/pub/irs-pdf/p463.pdf



IRS Publication 463 said:


> You are traveling away from home if:
> 
> - Your duties require you to be away from the general area of your tax home (defined later) substantially longer than an ordinary day's work, and
> 
> ...





BCS DRIVER said:


> What is IRS's definition of traveling?


I don't remember specifically, but I do remember that the IRS makes a distinction between "travel" and "transportation" in their lingo. If you remember that, it helps to alleviate the confusion. You might say that you travel to work every morning. The IRS doesn't say that. The IRS says that you take transportation or transport yourself to work every morning. In IRS lingo, "travel" means something specific and not all transportation is travel.


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## Uberfunitis (Oct 21, 2016)

It becomes a hobby after a given amount of time if no profit is earned. Not to mention all your creative accounting may screw you over in the long run if you don't have other sources of income and are not paying into social security.


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## Launchpad McQuack (Jan 8, 2019)

SamuelB said:


> Per H&R Block


This is probably correct because it is on their web site. Be advised, though, that if you go to H&R Block and talk to somebody, they don't know what they're talking about half the time.


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## FLKeys (Dec 27, 2018)

Uberfunitis said:


> It becomes a hobby after a given amount of time if no profit is earned. Not to mention all your creative accounting may screw you over in the long run if you don't have other sources of income and are not paying into social security.


You can lose money every year and not be a hobby, their are other requirements to be a hobby. Look at some of the markets where people are reporting Uber pays about the same as the Standard Mileage Rate. Unless you are screwing your self out of deductions or mileage it would be nearly impossible to show a taxable income. If the Hobby rule went in place in those markets there would never be any long term drivers.

The IRS expects that if you start a business, you intend to make money at it. If you don't, your business is likely to be a hobby. To determine if your business is a hobby, the IRS looks at numerous factors, including the following:


Do you put in the necessary time and effort to turn a profit?
Have you made a profit in this activity in the past, or can you expect to make one in the future?
Do you have the necessary knowledge to succeed in this field?
Do you depend on income from this activity?
Are your losses beyond your control?


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## Uberfunitis (Oct 21, 2016)

FLKeys said:


> You can lose money every year and not be a hobby, their are other requirements to be a hobby. Look at some of the markets where people are reporting Uber pays about the same as the Standard Mileage Rate. Unless you are screwing your self out of deductions or mileage it would be nearly impossible to show a taxable income. If the Hobby rule went in place in those markets there would never be any long term drivers.


But Sir, everyone is doing it..... I don't know why you are singling me out...... ride share really has not been around especially at the pay rates we currently have for all that long. When you look at the factors the IRS use to determine if something is a hobby rideshare would seem to fall in that category if you are not making a profit at it.


Whether you or your advisors have the knowledge needed to carry on the activity as a successful business.
Whether you were successful in making a profit in similar activities in the past.
Whether the activity makes a profit in some years and how much profit it makes.
Whether you can expect to make a future profit from the appreciation of the assets used in the activity.


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## Launchpad McQuack (Jan 8, 2019)

FLKeys said:


> The IRS expects that if you start a business, you intend to make money at it. If you don't, your business is likely to be a hobby. To determine if your business is a hobby, the IRS looks at numerous factors, including the following:




For tax purposes, what are the consequences of being classified as a hobby vs. a business? I'm guessing it affects what you can deduct. You can probably deduct business expenses but not hobby expenses. That's just a guess on my part. I guess my question is, why does it matter whether it is classified as a hobby or a business?


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## FLKeys (Dec 27, 2018)

Launchpad McQuack said:


> For tax purposes, what are the consequences of being classified as a hobby vs. a business? I'm guessing it affects what you can deduct. You can probably deduct business expenses but not hobby expenses. That's just a guess on my part. I guess my question is, why does it matter whether it is classified as a hobby or a business?


I don't know the correct answer to that because i have never been in that position. I would suspect it limits deductions you can take. I would have to look into it more.


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## Launchpad McQuack (Jan 8, 2019)

FLKeys said:


> I don't know the correct answer to that because i have never been in that position. I would suspect it limits deductions you can take. I would have to look into it more.


That is what I would guess as well. Just based on common sense, I would think that there are things that you can deduct as business expenses that you can't deduct if it is classified as a hobby. As an example, say you take up painting as a hobby. I'm guessing that you can't deduct the cost of all of your painting supplies and declare a loss on your taxes due to your painting activities. You're just painting for your own enjoyment, so you don't get to take deductions for that. Lets say you're a professional painter, though, and it's what you do for a living. Then I would think all of the supplies would be deductible as business expenses. That is just my assumption based on common sense, though. I don't know anything about it.


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## vtcomics (Oct 9, 2018)

Launchpad McQuack said:


> For tax purposes, what are the consequences of being classified as a hobby vs. a business? I'm guessing it affects what you can deduct. You can probably deduct business expenses but not hobby expenses. That's just a guess on my part. I guess my question is, why does it matter whether it is classified as a hobby or a business?


I believe If deemed a hobby you lose all business deductions.


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## UberTaxPro (Oct 3, 2014)

oldfart said:


> I claim a home office deduction. (Yes I have a room dedicated to my office) I know that that's a stretch but I operate under an LLC and I do private rides.so I do manage the advertising from there, send invoices and make phone calls. The advertising is a deduction too


It's not a stretch at all! Just keeping up with government required things like taxes, bookkeeping etc... justifies a home office IMO. If you'e ever audited tell the auditor you use the office to stay in complience with all the government entities on your back. Tell him/her that you needed the office to prepare for the audit! Not a problem!


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## EdThatUberGuy (Feb 20, 2019)

Gilby said:


> I run both Uber and Lyft apps at the same time. So I track all the miles for rideshare, and do not care about what the companies report as my mileage, because as soon as I get a ping on one, I turn the other one off.


I would think that if you're counting mileage from both apps then you're double dipping. If yoiu drive 100 miles with both apps on, you don't actually drive 200 miles. Just 100 miles. However, I've heard from several ride share drivers to track mileage from the time you leave your driveway until the time you return, since you are essentially fishing the passenger areas looking for riders. Dead miles + PAX miles (i.e. all miles from departure to return to your base of ops) are deductible.


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## Urbanappalachian (Dec 11, 2016)

How about the time wasted of not getting any fares for an hour I had my app on after the 9 a.m. rush hour? Or the day or week I didn't feel like working?

P.S. I paid about $2K in taxes last year. I did my own taxes. Someone I know was going to have my taxes done by someone she knows (a tax pro) and could "clear" it so I would have owed no taxes. The tax pro guy charges $300 I think. I'm trying to figure out how I can do this my self so I don't have to shell out $300.

That $2K I had to pay when I filed my own taxes I needed!

So how do I avoid paying federal taxes like Amazon?

This interesting article has the details?

https://finance.yahoo.com/news/amazon-taxes-zero-180337770.html
Sounds to me as if one could choose to pay or not pay their own taxes?

Amazon charges me a sales tax when I buy from them so I guess us customers are technically footing the bill for Amazon not having to pay federal taxes?

If you ask me, Uber, Lyft and other rideshare companies should be the ones responsible to pay all of driver's taxes, automatically included/taken out of their 25% cut!


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## Asis (Feb 7, 2019)

Dave Bust said:


> there are many additional write offs that you may be missing
> 
> your total uber miles plus the additional miles you drive with the uber app on.
> 
> ...


What about rental cost. I am driving with a rental car. Thanks


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## Irishjohn831 (Aug 11, 2017)

If you do ubereats and you spill a soda, your conscious gets to you so you pay to replace it, that $1.25 for that soda, deductible.

If you get a free soda, don't forget to claim it as income on your taxes, the IRS is watching you and your sodas

Rent a car, write off the rental. It's a wash and you don't have to buy a car or make car payments, you just make less but your expenses are deductible and so is your mileage.


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## FLKeys (Dec 27, 2018)

Irishjohn831 said:


> If you do ubereats and you spill a soda, your conscious gets to you so you pay to replace it, that $1.25 for that soda, deductible.
> 
> If you get a free soda, don't forget to claim it as income on your taxes, the IRS is watching you and your sodas
> 
> Rent a car, write off the rental. It's a wash and you don't have to buy a car or make car payments, you just make less but your expenses are deductible and so is your mileage.


Pretty sure if you write off a car rental you can not write off the miles using standard mileage deduction. You can only write off actual expenses like gas, car washes, etc.


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## Launchpad McQuack (Jan 8, 2019)

Urbanappalachian said:


> Amazon charges me a sales tax when I buy from them so I guess us customers are technically footing the bill for Amazon not having to pay federal taxes?


The sales tax that you pay is not a federal tax; it is a state tax. There is no federal sales tax.


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## polar2017 (Jul 1, 2017)

Hobby or a job. Tough to make a positive income in my state(nj) when rates are so low.
I have a net loss around $1300 for the year doing this part time. 
I track all miles door to door.
Claim treats, water, cell phone & data, car washes, phone accessories, floor mats etc.

Hobby or a job. Tough to make a positive income in my state(nj) when rates are so low.
I have a net loss around $1300 for the year doing this part time. 
I track all miles door to door.
Claim treats, water, cell phone & data, car washes, phone accessories, subscription radio, floor mats etc.


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## Asificarewhatyoudontthink (Jul 6, 2017)

Dave Bust said:


> there are many additional write offs that you may be missing
> 
> your total uber miles plus the additional miles you drive with the uber app on.
> 
> ...


Ah yes, the not an actual tax accountant or lawyer advise.

To which I will point out, as also a non professional in those areas...

You might want to realize that you are still responsible for paying your Social security contributions, which as a Self Employed IC is approximately 12% of gross income (take a look at what Uber claims your "gross" is).

So, have fun with that.



BCS DRIVER said:


> Meals. 50% deduction for the cost of it. I think the maximum daily amount is $25, after the 50%. Must keep receipts.
> 
> I've "heard" that it tracks all miles. If they do there's 2 big problems. 1st is do you really trust U/L to get anything right. 2nd is using their number will bite you in the ass if the IRS does an audit.


Meals, as part of Per Diem, are only deductible if you are not in your "home territory" such as OTR drivers in the trucking industry.



BCS DRIVER said:


> Drivers do not commute if they are doing strictly rideshare. As to the "normal business location" that's a little bit murky. No clear definition on that. Does it pertain to a specified radius around their "normal" place of business such as an office building? The city or state you do business in?
> 
> With no clear definition of normal business location I'll go with my opinion until told otherwise by a tax professional or the IRS. And if that so happens I'll say show me that in writing because otherwise it's their opinion being stated.
> 
> ...


No, traveling in this instance refers to traveling out of you home territory like flying out of state or OTR truck drivers as part of their per diem.


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## Older Chauffeur (Oct 16, 2014)

Asificarewhatyoudontthink said:


> You might want to realize that you are still responsible for paying your Social security contributions, which as a Self Employed IC is approximately 12% of gross income (take a look at what Uber claims your "gross" is).
> 
> So, have fun with that.


Social Security and Medicare taxes are figured at 15.3% of net profit , after deducting Uber's fees and your operating expenses from the gross shown by Uber. If your profits are less than $400 no SE taxes are due.


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## Asificarewhatyoudontthink (Jul 6, 2017)

Older Chauffeur said:


> Social Security and Medicare taxes are figured at 15.3% of net profit , after deducting Uber's fees and your operating expenses from the gross shown by Uber. If your profits are less than $400 no SE taxes are due.


Funny, I have never had a paycheck where it wasn't calculated based on gross earnings...


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## Older Chauffeur (Oct 16, 2014)

Asificarewhatyoudontthink said:


> Funny, I have never had a paycheck where it wasn't calculated based on gross earnings...


That's when you are an employee, and you and your employer share the 15.3% FICA equally. As an IC it's based on net profit.


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## oldfart (Dec 22, 2017)

Asificarewhatyoudontthink said:


> Funny, I have never had a paycheck where it wasn't calculated based on gross earnings...


Paycheck??

We don't get a paycheck


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## vtcomics (Oct 9, 2018)

Older Chauffeur said:


> That's when you are an employee, and you and your employer share the 15.3% FICA equally. As an IC it's based on net profit.


And this is why BUSINESS Income is NET whereas EARNINGS (aka working and receiving a "paycheck") are grossed up. Gotta know what you're talking about before freaking people out. Good grief.


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## EdThatUberGuy (Feb 20, 2019)

vtcomics said:


> And this is why BUSINESS Income is NET whereas EARNINGS (aka working and receiving a "paycheck") are grossed up. Gotta know what you're talking about before freaking people out. Good grief.


I ran all my ride share earnings through TaxAct, put in expenses and mileage, and and came up with a net loss of $1100 or so. If I had owed any SECA (the slef employed version of FICA) it would have brought that portion of the Q&A up. But it did not.


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## Older Chauffeur (Oct 16, 2014)

EdThatUberGuy said:


> I ran all my ride share earnings through TaxAct, put in expenses and mileage, and and came up with a net loss of $1100 or so. If I had owed any SECA (the slef employed version of FICA) it would have brought that portion of the Q&A up. But it did not.


Your TaxAct program is correct- it doesn't have to figure self employment taxes unless you have net profits of $400 or more. I use TurboTax and have had to pay SECA every year.:frown:


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## UberTaxPro (Oct 3, 2014)

FLKeys said:


> You can lose money every year and not be a hobby, their are other requirements to be a hobby. Look at some of the markets where people are reporting Uber pays about the same as the Standard Mileage Rate. Unless you are screwing your self out of deductions or mileage it would be nearly impossible to show a taxable income. If the Hobby rule went in place in those markets there would never be any long term drivers.
> 
> The IRS expects that if you start a business, you intend to make money at it. If you don't, your business is likely to be a hobby. To determine if your business is a hobby, the IRS looks at numerous factors, including the following:
> 
> ...


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## BigBadJohn (Aug 31, 2018)

IRS AUDIT RED FLAG -101
Claim a home office as a deduction on your taxes for rideshare in ANY way!


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## UberTaxPro (Oct 3, 2014)

BigBadJohn said:


> IRS AUDIT RED FLAG -101
> Claim a home office as a deduction on your taxes for rideshare in ANY way!


Why? the work required to stay compliant with the IRS, state and local taxing authorities justifies the need for some kind of "office" to work from IMO.


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## BigBadJohn (Aug 31, 2018)

My tax preparer is an retired IRS agent. I'll stick with what she recommends and who knows first hand what triggers audits.


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## oldfart (Dec 22, 2017)

BigBadJohn said:


> IRS AUDIT RED FLAG -101
> Claim a home office as a deduction on your taxes for rideshare in ANY way!


An audit is not the end of the world I've been there when I owned rental property and left with my return accepted as filed. Not fun but not a big deal either. It wasn't the home office that triggered the audit either

The home office deduction has changed. Now there is a standard deduction for the home office too. I suspect that using that is less of an issue for them


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## vtcomics (Oct 9, 2018)

BigBadJohn said:


> IRS AUDIT RED FLAG -101
> Claim a home office as a deduction on your taxes for rideshare in ANY way!


My tax guy said the same thing. The "office" required for Admin functions of rideshare are basically a laptop and maybe 5% of your internet bill. My guy said the IRS is taking a deeper look into rideshare related tax returns. I have no idea if that's true.


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## FLKeys (Dec 27, 2018)

BigBadJohn said:


> IRS AUDIT RED FLAG -101
> Claim a home office as a deduction on your taxes for rideshare in ANY way!


Let them do an Audit, I have nothing to hide. I have a small home office that I use exclusively for Rideshare related functions:

Transfer my written logs into Excel
Reconcile my expenses
Reconcile my income
Reconcile my deposits
Organize my written receipts
Organize my electronic receipts
File and store everything
Prepare my taxes


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## UberTaxPro (Oct 3, 2014)

vtcomics said:


> My tax guy said the same thing. The "office" required for Admin functions of rideshare are basically a laptop and maybe 5% of your internet bill. My guy said the IRS is taking a deeper look into rideshare related tax returns. I have no idea if that's true.


No one knows for sure what sets of an IRS audit, not even the agents handling the audits or the President. I can say just from observation, that over the last few years ride-share returns showing a loss on the schedule c are getting mail audits. Just my observation, doesn't mean anything statistically.


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## Launchpad McQuack (Jan 8, 2019)

BigBadJohn said:


> IRS AUDIT RED FLAG -101
> Claim a home office as a deduction on your taxes for rideshare in ANY way!


This may be true, but in my opinion the emphasis shouldn't be on avoiding an audit. The emphasis should be on being prepared to pass an audit in the event that it happens. Just make sure that you know the rules and have ample justification for any deductions that you take. As long as you are keeping adequate records and not trying to pass non-deductible things off as deductible, then an audit shouldn't be a big deal.


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## Asificarewhatyoudontthink (Jul 6, 2017)

oldfart said:


> Paycheck??
> 
> We don't get a paycheck


So you have never had a real job in the past....?

Because that is the only way my statement doesn't apply here.


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## Launchpad McQuack (Jan 8, 2019)

Asificarewhatyoudontthink said:


> So you have never had a real job in the past....?
> 
> Because that is the only way my statement doesn't apply here.


No, it doesn't apply because you are trying to apply the tax procedures for employee wages (W2 income) to self-employment income. It's not applicable. They're not treated the same way.


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## TXUbering (May 9, 2018)

I'm going to deduct the bottle of tequila I bought in order to read through this forum....


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## Older Chauffeur (Oct 16, 2014)

^^^^:biggrin:


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## oldfart (Dec 22, 2017)

Asificarewhatyoudontthink said:


> So you have never had a real job in the past....?
> 
> Because that is the only way my statement doesn't apply here.


I've had jobs with w2 income and I've owned businesses with 1099 income and the way taxes are calculated on one has nothing to with the other

Telling us how taxes are calculated on your "paycheck" has nothing to do with Uber income


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## Shawnllians (Oct 12, 2018)

No sir i paid 7k from 80-90 feom last year


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## UberTaxPro (Oct 3, 2014)

Shawnllians said:


> No sir i paid 7k from 80-90 feom last year


7K in taxes?


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## Shawnllians (Oct 12, 2018)

UberTaxPro said:


> 7K in taxes?


Yup 



Shawnllians said:


> Yup :frown:


After deductions everything im single so was higher


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## UberTaxPro (Oct 3, 2014)

Shawnllians said:


> Yup :frown:


Did you do your own taxes?


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## Shawnllians (Oct 12, 2018)

UberTaxPro said:


> Did you do your own taxes?


Nope but i guess that is what it is if you make 100k


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## p38fln (Oct 23, 2018)

It depends on the market and how good you are at avoiding deadhead. If you can avoid most deadhead mileage, or if Uber/Lyft pays closer to $1.00 / mile in your area and you can limit your deadhead to less than 42% of your mileage, you're going to pay tax, but it also means your self-employed business is actually turning a profit. 

What I've heard is failure to show a profit for at least 3 of the last 5 years will cause the IRS to consider your business to be a hobby, and with the new tax reforms saying you can no longer deduct non-reimbursed business mileage as an employee, that means no more mileage deductions for you.


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## Diamondraider (Mar 13, 2017)

p38fln said:


> It depends on the market and how good you are at avoiding deadhead. If you can avoid most deadhead mileage, or if Uber/Lyft pays closer to $1.00 / mile in your area and you can limit your deadhead to less than 42% of your mileage, you're going to pay tax, but it also means your self-employed business is actually turning a profit.
> 
> What I've heard is failure to show a profit for at least 3 of the last 5 years will cause the IRS to consider your business to be a hobby, and with the new tax reforms saying you can no longer deduct non-reimbursed business mileage as an employee, that means no more mileage deductions for you.


This is wrong, or every internet company would have bankrupted before getting noticed.


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## p38fln (Oct 23, 2018)

Diamondraider said:


> This is wrong, or every internet company would have bankrupted before getting noticed.


It's specified in IRS Publication 535, under the "Presumption of Profit" category

https://taxmap.irs.gov/taxmap/pubs/p535-004.htm
There are ways around it, which are also specified in Publication 535, but the rule of thumb is you have to have turned a profit in at least 3 of the last 5 years to be considered performing business activities rather than a hobby


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## Diamondraider (Mar 13, 2017)

Gross profit, generally

Facebook took over 5 years just to get cash flow positive in 2009...but still continued to post losses for a time after that.


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## vtcomics (Oct 9, 2018)

p38fln said:


> It's specified in IRS Publication 535, under the "Presumption of Profit" category
> 
> https://taxmap.irs.gov/taxmap/pubs/p535-004.htm
> There are ways around it, which are also specified in Publication 535, but the rule of thumb is you have to have turned a profit in at least 3 of the last 5 years to be considered performing business activities rather than a hobby


If you're a sole proprietor probably. As a corporation you can show losses forever. Just ask Amazon


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## p38fln (Oct 23, 2018)

vtcomics said:


> If you're a sole proprietor probably. As a corporation you can show losses forever. Just ask Amazon


Correct. The 3rd sentence of Publication 535 says:


> The limit on not-for-profit losses applies to individuals, partnerships, estates, trusts, and S corporations. It does not apply to corporations other than S corporations.


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## UberTaxPro (Oct 3, 2014)

vtcomics said:


> If you're a sole proprietor probably. As a corporation you can show losses forever. Just ask Amazon


The 3 of 5 rule is only a guideline and is used more as a "safe harbor". If you've got 3 of 5 yrs of profit you don't need to prove it's a business. Otherwise, there are 9 factors considered by irs when determining whether you're a business or a hobby:

How the taxpayer carries on the activity.
The taxpayer's expertise in this activity.
How much time and effort the taxpayer is spending carrying out this activity.
An expectation that assets used in an activity, such as land, may appreciate in value.
The taxpayer's success in other activities.
The taxpayer's history of income or losses from the activity.
The relative amounts of profits and losses.
The taxpayer's financial status.
Whether the activity provides recreation or involves "personal motives".


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## BurgerTiime (Jun 22, 2015)

Airport permits


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## IUberGR (Jan 2, 2016)

Dave Bust said:


> there are many additional write offs that you may be missing
> 
> your total uber miles plus the additional miles you drive with the uber app on.
> 
> ...


No. You can deduct the miles, OR you can total up your actual expenses (gas, maintenance, repairs, car washes, depreciation). You can't deduct both. Assuming your car gets any kind of decent mileage, and you didn't have a huge repair bill, the standard mileage deduction will be better and MUCH easier.


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