With Uber’s growth to millions of regular users across the world, it has become a platform with heavy financial activity.
So, if you’re wondering whether your finances on Uber are tax-deductible, we did the research and found out all you need to know!
Is Uber Tax Deductible in [currentyear]?
Uber might be tax-deductible for both riders and drivers, depending on what aspect of it you’re looking at in [currentyear]. If you’re considering the parts of the service that are business expenses, then you could potentially write it off. In order to successfully deduct Uber expenses from your taxes, you’d need to prove the figures using verifiable documents like receipts.
Keep reading to learn everything you should know about deducting Uber from your taxes, including what you can write off, how to do it, and more!
Can I Write Off Uber Rides on My Taxes?
As a passenger, whether you can write off Uber rides on your taxes depends on the purpose of the trips.
Unfortunately, you can’t write off trips if they were part of your work commute because those are considered personal expenses.
However, you can write off Uber trips that were taken as part of business, such as when you were away during a work trip or going to meet a client.
A general rule of thumb is that you can write off rides if you take them after you’ve already started doing business.
However, commutes don’t qualify because business doesn’t start until you get to work and it stops when you leave.
If you get reimbursed, or you’re on a system like Uber for Business where your company covers the costs, you might not be able to write them off.
Will Uber Give Me a 1099?
Uber will give you a 1099, and the form you get will depend on different factors around your activity as follows:
- 1099-K – this is issued to drivers who made more than $20,000 and provided more than 200 rides. Depending on where you’re based, you might get one even if you earn less than $20,000
- 1099-NEC – this is issued to drivers who made $600 or more from sources other than riders, e.g. promotions, bonuses, and referrals
- 1099-MISC – this is issued to drivers who made $600 or more from other sources, e.g. legal settlements
By default, Uber gives drivers their 1099s via email, but you can opt to have a physical copy sent to you in the mail.
To do this, follow these steps:
- Visit drivers.uber.com and sign in to your account
- Select “Tax settings” at the top of the page
- Remove the tick from the box that says “Go green! Download 1099 forms electronically!”
Does Uber Report Mileage to the IRS?
Uber does not report mileage to the IRS, but drivers get a synopsis of it in their annual tax summary.
In reports to the IRS, Uber only reports the amount it paid to drivers, the same information contained in the 1099s.
You can use the information from your tax summary to calculate how much to write off in mileage, as we’ll discuss below.
How Can I Claim Uber Mileage on Taxes?
To claim your Uber mileage on your taxes, you can start by looking at the figure quoted in your tax summary.
This number will be marked “online miles” and will only show your mileage when you were active on the app, e.g. driving to pickup locations and during rides.
You can then use standardized rates from the IRS to calculate how much this comes out to then write it off.
Every year, the IRS calculates what the rate is and makes it public. For example, in the 2022 tax year, it was 58.5 cents per mile.
You could potentially write off even more mileage if you also track the numbers when you’re working, but not online.
Some of these situations include the following:
- Driving to and from gas stations
- Driving back to your city after your previous ride took you farther away than you could receive requests
- Driving to other work-related places such as Green light Hubs
If you choose to do this you’ll need to be thorough, recording exact odometer readings before and after, what you were doing, and addresses.
How Do You Write Off Uber?
As a driver, you can write off Uber if you have detailed and verifiable records of the money you spent on the gig.
Your tax summary is a good place to start if you have nothing else because it provides solid numbers, including mileage and fees you were charged for using the platform.
Because these are straightforward expenses, they’re easier to write off.
Other business expenses you might be able to write off if you kept track of them include the following:
- Gas
- Commercial or ride-share insurance
- Part of your phone bill that went into communicating with riders
- Equipment you bought for the job such as a dash cam
This, like the rest of the information in the article so far, is intended for illustrative purposes and we recommend consulting a tax professional to go over your options.
To know more, you can also read our posts on Uber minimum fare, do Uber drivers pay taxes, and how Uber insurance work.
Conclusion
Uber might be tax-deductible if you look at the costs that were purely business expenses. For riders, commutes don’t apply but work trips do.
Drivers can write off mileage, gas, commercial insurance and other expenses if they keep track of the exact amounts they spent using receipts or Uber’s tax summary.
