Uber Drivers Forum banner
1 - 17 of 17 Posts

·
Registered
Joined
·
21 Posts
Discussion Starter · #1 ·
Was wondering if anyone has received solid CPA advice on paying (or not paying) GRT to NM Taxation & Revenue? Info on uber movement ABQ states "As an entrepreneur on the Uber Platform, you're responsible for paying applicable income tax, gross receipts tax and complying with any applicable state and local registration requirements, like nay small business"; how do we know what is the total taxable collected by Raiser?

Also, I understand the driver "push back" on this subject (we "the drivers" don't collect payment, inclusive of GRT, therefore not our responsibility)! But how do the professional CPAs and state of NM reconcile this issue? The GRT due date for the month and/or quarter (depending on your total sales) is coming up soon, so what risk/jeopardy are the drives potentially exposed to?
 

·
Registered
Joined
·
276 Posts
Was wondering if anyone has received solid CPA advice on paying (or not paying) GRT to NM Taxation & Revenue? Info on uber movement ABQ states "As an entrepreneur on the Uber Platform, you're responsible for paying applicable income tax, gross receipts tax and complying with any applicable state and local registration requirements, like nay small business"; how do we know what is the total taxable collected by Raiser?

Also, I understand the driver "push back" on this subject (we "the drivers" don't collect payment, inclusive of GRT, therefore not our responsibility)! But how do the professional CPAs and state of NM reconcile this issue? The GRT due date for the month and/or quarter (depending on your total sales) is coming up soon, so what risk/jeopardy are the drives potentially exposed to?
This is a sticky situation. Most drivers probably do not file taxes. Mu main question is do you have a tax id number? If not how can one possibly file? As you can see this is a problem.
 

·
Premium Member
Joined
·
52 Posts
The way Uber has set it up, the entire fare goes to you, the driver, and then you pay back the SRF and commission. Therefore, from the state's perspective, you owe Gross Receipts Tax on the entire fare, even the portion Uber gets. Uber is certainly not paying it, and they don't have to based on the way they set it up. The driver is responsible for it.

Obviously, Gross Receipts Tax is not going to be paid or paid fully for a lot of Uber drivers, and it's probably not worth it for the state to go after everyone. But they probably will come after a percentage. As an independent contractor, you need a NM tax ID number. Your annual gross sales numbers need to be similar for your NM GRT forms and your Schedule C IRS forms. Without that, you're red flagging yourself for an audit, and leaving yourself wide open for the state to come after you.

So the question then is based on your own situation, would it be worth it for the state to come after you?
 

·
Registered
Joined
·
4 Posts
The way Uber has set it up, the entire fare goes to you, the driver, and then you pay back the SRF and commission. Therefore, from the state's perspective, you owe Gross Receipts Tax on the entire fare, even the portion Uber gets. Uber is certainly not paying it, and they don't have to based on the way they set it up. The driver is responsible for it.

Obviously, Gross Receipts Tax is not going to be paid or paid fully for a lot of Uber drivers, and it's probably not worth it for the state to go after everyone. But they probably will come after a percentage. As an independent contractor, you need a NM tax ID number. Your annual gross sales numbers need to be similar for your NM GRT forms and your Schedule C IRS forms. Without that, you're red flagging yourself for an audit, and leaving yourself wide open for the state to come after you.

So the question then is based on your own situation, would it be worth it for the state to come after you?
What do you mean "The way Uber has set it up"? Not sure where it is set up that is being referred to...set up with the State of NM? Or on the 1099 form they issue?

While I agree that they want the driver to pay the Gross Receipt Tax out of our own pockets, including their 25%, I don't have any way of knowing anything about the SRF fee they charge - I don't see it reflected on any statements I receive from Uber that I have been able to identify....so how can a driver be responsible for the GRT on this fee?

Honestly the whole thing is screwed up - obviously, the GRT should NOT be coming out of driver pay unless we are give the opportunity to collect it from the passenger (HA!). Uber sets the rates, Uber collects the money, Uber decides on the percentage they are willing to share with the driver, etc. I think the whole issue is ripe for a lawsuit or legislation. Despite what Uber wants the driver to pay for, I think it would not stand if it were challenged.
 

·
Premium Member
Joined
·
52 Posts
The 1099 form includes the SRF fees. The total number on that form is then sent to the feds and the state. Then the state can cross reference that amount with your GRT tax payments for your tax ID number.

I'm totally understanding and sympathetic of the position that you shouldn't have to pay taxes on money you don't personally collect, but I'm not sure that the state of New Mexico would share the same sympathies.
 

·
Registered
Joined
·
4 Posts
The 1099 form includes the SRF fees. The total number on that form is then sent to the feds and the state. Then the state can cross reference that amount with your GRT tax payments for your tax ID number.

I'm totally understanding and sympathetic of the position that you shouldn't have to pay taxes on money you don't personally collect, but I'm not sure that the state of New Mexico would share the same sympathies.
The 1099 form is issued once a year, correct? GRT taxes are due quarterly, or for businesses with low sales, every 6 months. How is a driver supposed to submit the correct GRT taxes if we only get yearly statements from Uber ? Obviously, if Uber drivers were truly independent contractors, (and set our own rates, or collect the GRT tax) we'd have the information we'd need to be able to submit quarterly, etc.

Not having been driving for Uber for but 3 months, I have yet to receive my first 1099. I'm curious if you have any knowledge of how guarantee money paid to the driver is reflected on the 1099?
 

·
Registered
Joined
·
30 Posts
The Safe Ride/Booking fee of $1.90 gets taken out of our pay but does not reflect on weekly pay statements. When you calculate the 25% fee + the booking fee you will see where your calculations align to what is your cut. I had the same gripes and still do. But I feel like it falls on deaf ears since Uber could give two shits about us little people. The Uber fee and safe ride/booking fee are in fact expenses by definition of IRS since it is something necessary and ordinary. Being able to deduct this expense does help lower the amount owed for taxes. And if you use standard mileage deduction and keep good record with apps like hurdlr, that will also lower the amount of taxes you will have to pay. You only have to pay estimated quarterly taxes if you are expecting to owe $1000 or more. If you have a regular full time job on top of Uber driving, you may have already had enough taxes taken out. You can also ask your employer to take out more to cover anything owed for rideshare taxes. As far as bi-annual gross receipts tax, those you do have to pay no matter what. GRT are State & City/County taxes separate from federal Annual Income Tax. Don't quote me and you can look it up but I believe it is at a 7.13% right now. When you enter your profit in the TAP it will calculate the tax amount owed for you so you wont have to stress about that.
 

·
Registered
Joined
·
21 Posts
Discussion Starter · #8 ·
Ok... thanks for all the replies... appears as though the ABQ uber drivers are all over the board on this (yes/no to pay GRT)... it's a significant amount of money (percentage wise). Simple math suggest a loss of about 10% of your payout if you pay NM the GRT, example: total fare $100, uber takes $25, your payout is $75.00, the GRT is about 7.25% or $7.25 to NM per $100 gross fare, resulting in your new before expenses net of $67.75 instead of the $75 you thought you made... who is really going to volunteer to pay NM 10% of their payout before any expenses (gas, insurance, maintenance, etc... not to mention depreciation). My conclusion, being an uber diver is trading in future long term expenses for immediate near term income and you really make nothing... more accurately you literally lose money over the period of a few years...

The only viable solution is to lobby uber to pay GRT and increase the fare rates... also, stop with the new driver sign-ups... the amount of uber vehicles on the road in ABQ is crazy high... at best, I'm getting just over one fare per hour (44-48 fares p/40 hour work period)... my payout is roughly about 50 cents per total miles driven in a day (if my payout is around $100 for the day, you can bet I drove around 200 total miles)... thanks again for all your replies, v/r -broke in ABQ
 

·
Registered
Joined
·
30 Posts
Ok... thanks for all the replies... appears as though the ABQ uber drivers are all over the board on this (yes/no to pay GRT)... it's a significant amount of money (percentage wise). Simple math suggest a loss of about 10% of your payout if you pay NM the GRT, example: total fare $100, uber takes $25, your payout is $75.00, the GRT is about 7.25% or $7.25 to NM per $100 gross fare, resulting in your new before expenses net of $67.75 instead of the $75 you thought you made... who is really going to volunteer to pay NM 10% of their payout before any expenses (gas, insurance, maintenance, etc... not to mention depreciation). My conclusion, being an uber diver is trading in future long term expenses for immediate near term income and you really make nothing... more accurately you literally lose money over the period of a few years...

The only viable solution is to lobby uber to pay GRT and increase the fare rates... also, stop with the new driver sign-ups... the amount of uber vehicles on the road in ABQ is crazy high... at best, I'm getting just over one fare per hour (44-48 fares p/40 hour work period)... my payout is roughly about 50 cents per total miles driven in a day (if my payout is around $100 for the day, you can bet I drove around 200 total miles)... thanks again for all your replies, v/r -broke in ABQ
After hearing from both Uber and Lyft customer service it was determined that the driver pays the gross receipts tax. Even though we are not the ones collecting the money, they are somehow getting away with making us pay the taxes. The one tricky question I haven't received an answer on is whether they are taking taxes out of the passengers payment and remitting it to us the driver? Or, are they simply not charging the passenger tax and expecting us to pay their tax? I know if it was remitted to us then it would be out of our hands and straight into the states. But that is different from taxes not being collected from the passenger at all....and us footing the tax bill taking MORE out of our profit. Does anyone have any idea on this factor??? I am going to have my girlfriend take a ride and I will let you know what I find out as I compare the passenger charge from driver pay.
 

·
Registered
Joined
·
21 Posts
Discussion Starter · #10 ·
thanks for digging in TecJay... I'm thinking uber is NOT collecting tax of any kind, and we are to subtract GRT from our pay out (there goes approx 10% of your already earned amount since we will have to pay tax on the gross fare)... definitely not ethical on the part of uber, and I'm wondering if such action is even legal by them (we don't collect the money)... such a shame how they treat drivers, hence the large turnover and constant rewards offered for more drivers. If uber can attach a surcharge for airport fees, then one would think it's simple to make a software change and add GRT to the rider fare... but, we are such nobody with uber... and so many of us, they won't put in the effort (affects 8 states I believe)
 

·
Registered
Joined
·
21 Posts
Discussion Starter · #11 ·
just received a reminder from Uber Partners: This Week in Albuquerque - 10/13 email that states under "Things to Know"; "As a business owner it's important to understand the Gross Receipt Tax obligations that all business are subject to. Find out more HERE."... the here is a link to the albuquerque ubermovement website language under Gross Receipts Tax "As an entrepreneur on the Uber Platform, you’re responsible for paying applicable income tax, gross receipts tax and complying with any applicable state and local registration requirements, like any small business."

funny how uber asked me for a driver survey on the same day... rated them one star and commented on the poor earnings and GRT requirement (they should collect and pay)... so now I'm formulating an email to the Taxation Department of NM wherein I'll attempt to get an interruption for collection/payment requirements from them. I don't believe many uber drivers are, or will voluntarily comply, with the GRT payment to the state... seems like Santa Fe would go after one entity (uber) for resolution vs attempting to get payment/back pay from all the drivers... thoughts?
 

·
Registered
Joined
·
12 Posts
Yeah I'm going to be honest...this all looks like a foreign language.
I'm only 23 and basically just figured out how to file my taxes on turbotax last year. I didn't find out till 2 months ago I was considered "self employed" and that if I "kept my gas reciepts and a log of mileage used I can write it off and not pay anything" however, I didn't do that. At all. I was able to go back and track how much mileage I did but I honestly can't tell how often I filled up. Someone also said "you have to pay 10-20% back to the irs" and after calculating that's basically the entire amount I've made while working. I want to be a good person and do my taxes right and what not but I'm seriously scared and confused. I can't imagine what's happening for others my age or even younger....
 

·
Registered
Joined
·
21 Posts
Discussion Starter · #13 ·
You may want to seek professional tax advice... there are a lot of misconceptions in the online rideshare world. Example from your post, you can't claim gas AND mileage... you choose between actual vehicle cost (which contains many items like fuel, maintenance, tires, and insurance as examples), OR you can take the standard mileage deduction... not both.

I choose mileage for simplicity, and since we usually drive about double the "on fare" miles, you will usually not pay additional income tax. You are responsible for NM GRT (so thinks uber)... that test will come early next year.

Suggest you obtain a mileage log app... several to choose from. The log must contain lots of info for EACH event (like date, to/from address, and start/stop odometer just to name a few)... I log TNC staging relocation, TNC en route to pick up, and TNC on trip... plus to/from maintenance, etc.

...and you're correct, the average TNC driver has no real clue about tax and record keeping requirements...
 

·
Registered
Joined
·
21 Posts
Discussion Starter · #15 ·
Uber appears to claim that the GRT is included in the gross fare charge (not a separate fee to the rider)... therefore it's "collected" and you are obligated to forward to the NM T&R Department - I agree with most drivers that it's disgusting such a company would treat the human capital which actually "makes" them money so aweful... but that is how Uber is playing the game until the courts decide different. We have been warned by way of the ABQ specific Uber website and the occasional email distribution that reminds drivers they must pay NM GRT.

note: a few other states have similar issues, some of which have laws that specifically require TNC's, aka Uber and Lyft, to collect and pay the "sales tax" - not yet addressed in NM

There appears to be three camps with different thoughts in NM regarding the GRT... 1) suck it up and pay the tax themselves (most conservative approach and will clear an audit)... 2) abstain from paying GRT, take the risk and claim that "uber owes the GRT" during an audit... unknown outcome, could be low or high risk... perhaps forgiven, but if fined could be a substantial amount)... and 3) they truly have NO idea as related to NM tax laws (or those of the IRS), will claim "stupidity" and could be subject to possible penalties.

I'm NOT a tax professional, however I have dug into this issue... most CPA's will take camp 1 approach due to the no/low risk audit outcome.

There are several emotional responses to the various sales tax and/or GRT issues throughout uberpeople forums... the actual consequences to NM drivers will be determined after the 2016 tax filing and audit season is over as we report out what happened to "us" individually... good luck..!

p.s., if there is a Tax Pro (cpa or lawyer) out there willing to weighin and provide documentation or reference material that will support NO GRT owed by drivers, and will pass an audit, please please please provide it to us -thanks
 

·
Registered
Joined
·
1 Posts
Uber appears to claim that the GRT is included in the gross fare charge (not a separate fee to the rider)... therefore it's "collected" and you are obligated to forward to the NM T&R Department - I agree with most drivers that it's disgusting such a company would treat the human capital which actually "makes" them money so aweful... but that is how Uber is playing the game until the courts decide different. We have been warned by way of the ABQ specific Uber website and the occasional email distribution that reminds drivers they must pay NM GRT.

note: a few other states have similar issues, some of which have laws that specifically require TNC's, aka Uber and Lyft, to collect and pay the "sales tax" - not yet addressed in NM

There appears to be three camps with different thoughts in NM regarding the GRT... 1) suck it up and pay the tax themselves (most conservative approach and will clear an audit)... 2) abstain from paying GRT, take the risk and claim that "uber owes the GRT" during an audit... unknown outcome, could be low or high risk... perhaps forgiven, but if fined could be a substantial amount)... and 3) they truly have NO idea as related to NM tax laws (or those of the IRS), will claim "stupidity" and could be subject to possible penalties.

I'm NOT a tax professional, however I have dug into this issue... most CPA's will take camp 1 approach due to the no/low risk audit outcome.

There are several emotional responses to the various sales tax and/or GRT issues throughout uberpeople forums... the actual consequences to NM drivers will be determined after the 2016 tax filing and audit season is over as we report out what happened to "us" individually... good luck..!

p.s., if there is a Tax Pro (cpa or lawyer) out there willing to weighin and provide documentation or reference material that will support NO GRT owed by drivers, and will pass an audit, please please please provide it to us -thanks

Hi all,
I am not a Tax Professional, so I personally checked with the source of this evil, The NM Taxation and Revenue Department. I did this because one CPA’s response to the next was so convoluted it had me even more confused than when I started out!

Two important facts; the first is that NM was one of the few states where GRT’s receipt sales were origin-based (meaning responsible payor is determined where the charge originated from) instead of like most States, Destination-based (where the actual charge took place). This is really why they haven’t come after us Drivers...yet.

That changes in July 2021 due to some greedy legislation getting amended that will now make NM a sales destination-based entity for ALL PASS-THRU businesses, including Uber/Lyft transportation services. Yup, NM found a way to put their greedy paws in each and every NM Drivers pockets BUT, not right away. It will go thru a transition period, and even though the new ruling has an effective date of July 1, 2021, we will most likely not see an enforcement until Jan 2022.

The good news and #2 fact to keep in mind, the State is only requiring each Driver to pay GRT off the money we get AFTER Lyft/Uber takes their cut (Booking & Svc fees as well as the 3rd Party Fee’s). While there is still no legal precedent (that can win in court anyway) of forcing a Driver or any entity for that matter, to pay a GRT when we do not hold the contract for payment that each Passenger signs, upon creating an account. That contract is specifically between Uber/Lyft and Passenger.

In order for THAT to happen, we (Drivers) would have to given decision powers (authority) over any and all payment decisions. (refunds for example) as well as rights to receive the ORIGINAL payment receipt. (Just try to get one now and see where that gets you)

That won’t stop the State from coming after the little guy, and they purposely did it this way because it’s easier to get the money from us than from a multi billion dollar company, with corporate attorneys to give the run-around they’ve gotten so far.

The only question now is at what level does this NMGRT get calculated, the Gross Receipts or the Adjusted Gross Receipts level? One could argue, and quite well I might add, since the State is allowing the inclusion of one Business Expense (All Fees that are kept by Uber/Lyft) then ALL Business Expenses should apply and this tax should be calculated from the AGI (pre-tax) level. Otherwise, that could easily be filed as “cherry picking” on what is or isn’t required to be paid as well as from which entity that applies to. A Federal No-No even at the State level. Also just what the new local sales tax rate for “service” will be; 5% or based from the county where your “Home-Base/Office” is located. For Bernalillo, that could be adding on another 3.175% (don’t quote me on that rate, haven’t checked back to find the States final answer yet).

Hope this novel helps my fellow drivers out there!
 
1 - 17 of 17 Posts
Top