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The two questions I’ve gotten most since starting this site a couple months ago have been about insurance issues and taxes. Well I covered insurance in Episode 2 and even though it took a lot out of me I’m back for more. Taxes are probably one of the most overlooked parts of rideshare driving because you don’t have to worry about them until April every year.
Since I have experience with starting my own businesses and working as a 1099 employee, a lot of the same tax principles that apply there also apply to rideshare taxes. Since rideshare drivers are self-employed and paid via a 1099, most drivers may not even realize that they now need to file a Schedule C as a sole proprietor when they do their taxes. If that last sentence confused you, then this podcast is for you. And even if it didn’t, there is still a lot of great information in there that can help you with your taxes
Taxes can be confusing and convoluted but I tried to really break it down into layman’s terms and tell you exactly what I plan on doing and why. If you have any follow-up questions feel free to leave them in the comments section or send me an e-mail. I’ve gotten great feedback so far on the first two podcasts and it has really inspired me to make sure that I am putting out some epic content. As of 7/7/14, the first episode has been downloaded 422 times and the second episode has been downloaded 445 times.
Summary of the Show:
- I’m getting married but I’m still working
- My Travel Hacking
Lyft and Uber’s Policies Toward Taxes
- Lyft and Uber don’t provide much help when it comes to taxes
- How do 1099’s work?
- 1099 vs W2 and how it affects tax payments
- Schedule C for a Sole Proprietorship
- Definition of a Business
- The $600 1099 myth
- Lyft and Uber are classified as online payment providers
- Will you get a 1099?
How Do Estimated Tax Payments Work?
- When and why do you have to file estimated tax payments?
- 1040 ES
- Always file your taxes!
- Strategies for W2 & 1099 employees to avoid estimated tax payments
Deductions for Rideshare Drivers
- Deductible business expenses
- Deduction vs. credit
- Marginal tax bracket
- Why rideshare is great for high income/low income spouses
- Actual mileage vs Actual Expenses
- Personal vs. business use of your vehicle
How to Maximize Your Mileage Deduction
- What mileage is deductible?
- Can you deduct miles when there are no passengers in your car?
- What I learned from my rental property taxes that applies to rideshare taxes
The Best App to Track Your Mileage & Expenses
- Business owners have to do a lot more work when it comes to record-keeping
- Take pictures of your receipts, start/stop your trips and more with this app
- Taxes are boring but you need to at least understand the basics whether you go to a CPA or not
- If you do hire a CPA, find one who specializes in rideshare taxes and/or small businesses
- Nobody cares more about your money than you do
- I will deduct every penny that I’m entitled to
- Subscribe to our e-mail list!
- Please leave a review on iTunes or Stitcher if you enjoyed the podcast
- My personal finance blog where I talk about all my travel hacking: Your PF Pro
- Lyft’s Tax Policy
- Uber’s Tax Policy has been removed from their website (Here’s an article that quotes their policy before it was removed from the website)
- Federal Tax Brackets
- IRS Document: Deducting Business Expenses
- IRS Topic 510: Business Use of a Car
- NOLO Landlord Tax Deduction Guide – This is the book I read in order to figure out the taxes on my rental property, a lot of the same principles apply to small businesses.
Thank You For Listening!
Quick Disclaimer: I am not a tax professional, this podcast is for informational purposes only. You should not take what I say as fact and any information provided in this podcast is solely applicable to my personal tax situation and not yours. Any correspondence between you and I does not create an advisory, fiduciary or professional services relationship.
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And lastly, if you have any questions, comments or concerns don’t hesitate to reach out to me.
After hearing all of the information in the podcast, is there anything you’re still confused about when it comes to rideshare taxes? Do you plan on doing your taxes yourself or hiring a CPA to do them for you?
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-The Rideshare Guy