Rideshare drivers like, Uber and Lyft have some unique tax deductions that other businesses may not:
1. Food and drink for passengers – To make passengers feel more comfortable, Uber drivers offer them
water and candy which helps to make their drive more pleasurable, especially when stuck on the
freeway.
2. All of your car expenses – Lyft and Uber drivers must maintain their cars/autos since that is the
tool they use to make their money. Therefore, any expenses to maintain their car is deductible,
like insurance, repairs, car washes, tolls, lease payments, depreciation, interest on financed car,
AAA membership, license and registration. If you don’t want to track your actual expenses you can
choose to use mileage you drive and get to use .53 a mile required by IRS. No matter which method
you use, you MUST keep a log of where you went, business purpose and who you saw.
3. Don’t forger the Uber and Lyft service fees you pay. That can adds up to 20% of the money you
make.
4. Even as a rideshare driver, if a long ride and you want to take your customer for a meal, that
would be an entertainment deduction.
5. Telephone and data plan expenses are a necessary expense to be contacted to pick up your ride.
6. If you buy and electric car, don’t forget the tax credits associated with purchasing this
environmental savings car.