Yes. You can deduct the following business related expenses:
Vehicle Deductions (usually the largest one)
Since you're an independent business owner, just about any money you spend on your gig as a ride-share driver will be a tax-deductible business expense. The first thing that probably comes to mind is your car. There are two ways to take a deduction for the business use of your car:
- Deduct the actual expenses of operating the vehicle for business, including gas, oil, repairs, insurance, maintenance and depreciation or lease payments OR
- Take the standard IRS mileage deduction. As of 2016, the rate is 54 cents per mile driven for business use.
If you use your car for both ride-sharing and personal transportation, you can deduct only the portion of your expenses that apply to the business use. And whichever type of deduction you claim, it's critical that you keep thorough records. The IRS could disallow any tax deductions you can't support with receipts, logs or other documentation.
Other tax deductions include:
- Water, gum or snacks for passengers
- Tolls and parking fees
- The portion of your mobile phone expenses attributable to your ride-share work can be used to reduce your self- employment income. For simplicity's sake, it may make sense to have a dedicated phone for work.
- Car Washes
- AAA or other roadside assistance plans
- Common Operating Expenses
- Registration fees and taxes
- Vehicle Loan Interest (can use either Standard or Actual)
- Airport registration fees
Note - You will need to upgrade to Self-Employed to enter business expenses.
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