[RidesharingCPA]

Hey everyone,
I’m a CPA who has done in-depth research on the tax side of being an Uber and Lyft driver. There are a lot of ways to maximize your deductions, and I’m here to help if you have any tax-related questions—whether it’s mileage tracking, vehicle expenses, or how to handle quarterly taxes.
Feel free to ask me anything in the comments, and if you’d like a free eBook I’ve put together on tax savings for rideshare drivers, just shoot me a DM, and I’ll send it over!
Looking forward to helping you get the most out of your tax deductions this season! 💰

 

[losiglow]

Have you ever had the IRS request mileage records? If so, what would constitute legitimate mileage records? Just an excel spreadsheet? Or maybe a log book of some sort?

 

[Jon Stoppable]

Bear greets CPA human.

 

[Disgusted Driver]

Bear greets CPA human.

Please don't eat them, they bring value beyond food.

Question on mileage calculation: If I start from home, have my app on and get a ping a mile away, is the mile from my house to the first pickup deductible?
Similarly, after my last drop off, can I deduct the mileage back to my home?

 

[25rides7daysaweek]

Please don't eat them, they bring value beyond food.

Question on mileage calculation: If I start from home, have my app on and get a ping a mile away, is the mile from my house to the first pickup deductible?
Similarly, after my last drop off, can I deduct the mileage back to my home?

If a bear eats the pax and gives himself a huge tip before tossing the phone into a lake, are those dead miles to get home a deduction also?

 

[Jon Stoppable]

If a bear eats the pax and gives himself a huge tip before tossing the phone into a lake, are those dead miles to get home a deduction also?

Bear lives by the lake, so no worries there. Also, bears don't pay tax.

 

[RidesharingCPA]

Please don't eat them, they bring value beyond food.

Question on mileage calculation: If I start from home, have my app on and get a ping a mile away, is the mile from my house to the first pickup deductible?
Similarly, after my last drop off, can I deduct the mileage back to my home?

Commuting Miles are not deductible, however, if your intent it to drive further for a better ridesharing location then those miles are deductible to and from your home location even though your homes is not a primary place of business.

 

[RidesharingCPA]

Have you ever had the IRS request mileage records? If so, what would constitute legitimate mileage records? Just an excel spreadsheet? Or maybe a log book of some sort?

I have never had the IRS request that information. You would need to track the date, location, and miles driven.

 

[_Tron_]

Phew. With a new tax guy entering the Enchanted Uber Forest (where nothing is as it appears) I was concerned our local tax bear would make said new tax guy his next meal.

But no, bear must like the idea of playing tag-team to cure humans of their tax ignorance.

Welcome to the forum @RideshareCPA! Live long and prosper.

 

[RidesharingCPA]

If a bear eats the pax and gives himself a huge tip before tossing the phone into a lake, are those dead miles to get home a deduction also?

😂

 

[RidesharingCPA]

Thanks

 

[Jon Stoppable]

Phew. With a new tax guy entering the Enchanted Uber Forest (where nothing is as it appears) I was concerned our local tax bear would make said new tax guy his next meal.

But no, bear must like the idea of playing tag-team to cure humans of their tax ignorance.

Welcome to the forum @RideshareCPA! Live long and prosper.

The state Board of Accountancy told bear that bears are not allowed to be CPAs because bears have no ethics (this is true, bear would eat a client if bear thought that would be the best course of action). So even though bear brought bear's passing grade letter (carried in mouth walking on all fours as bear had not learned better yet), the mean humans sent bear away

 

[Stevie The magic Unicorn]

Let me set a trap for you.

If I rent a car for 12 hours from a chaffeur company is 100% of it deductible even if it exceeds the standard mileage rate?

Commuting Miles are not deductible, however, if your intent it to drive further for a better ridesharing location then those miles are deductible to and from your home location even though your homes is not a primary place of business.

Would the transportation cost to pick up a rental vehicle for business use be deductible?

What if the company you are renting from allows you to park your own vehicle on premises? Would those miles to the rental company be deductible?

 

[losiglow]

I have never had the IRS request that information. You would need to track the date, location, and miles driven.

Thank you. I ask because it seems like this would be a very easy thing to fudge on taxes. I'm surprised the IRS doesn't request some sort of record. In my several years of doing RS, I have kept my own record (using a third party app) but admittedly, I could just as easily keep the app on when I'm not driving rideshare and rack up the miles. Then deduct those miles dishonestly.

I've been audited before and it was no fun. As such, I'm fairly honest in my IRS dealings. Regardless, I wonder if keeping track with an app is sufficient or if they'd come after me in some other manner. But I suppose if you've never had this requested from the IRS, I'll rest well enough with my current method.

 

[Jon Stoppable]

Humans might consider this, written long ago when the audit rate of ordinary taxpayers was much, much higher:

An IRS Guide To Auditing Taxicab Income

 

[New2This]

If a bear eats the pax and gives himself a huge tip before tossing the phone into a lake, are those dead miles to get home a deduction also?

Bear should book ride to one block from bear's cave before throwing phone into lake.

 

[Trafficat]

Am I likely in deep shit with the IRS if I use Uber's miles driven number for my deduction, or are they likely to accept that as a valid number? I know they track us on GPS for every pickup and drop off.

Writing each address in a booklet is super tedious.

 

[Seamus]

Am I likely in deep shit with the IRS if I use Uber's miles driven number for my deduction, or are they likely to accept that as a valid number? I know they track us on GPS for every pickup and drop off.

Writing each address in a booklet is super tedious.

I’ve been doing small business and personal tax returns for decades, and I am an enrolled agent with the IRS.

I don’t get involved anymore with most peoples tax questions on the forum for a variety of reasons. I will say @Jon Stoppable is right on the money with a lot of his responses.

For a variety of reasons, it’s a very bad idea to rely on Uber for your mileage records, mostly because they’re not very accurate.

However, there is a tax case precedent out of a tax court ruling in California that supports Ubers mileage numbers given to drivers. The case involves an Uber driver who had his mileage deductions of 80,000 miles not accepted by the IRS for insufficient documentation. They disallowed his entire mileage deduction.

The driver was one of the few people I’ve ever heard of that actually went to tax court over the IRS ruling. To make a long story short, although the judge disallow the significant portion of his deduction, he did accept the portion that was supported by Uber provided mileage. So even though Uber provided mileage does not technically meet the IRS mileage documentation standards, It was allowed by the judge in this case.

The importance of that is now there is case law that can serve as a precedent that most would honor. I’ve kept a reference file of the case and the ruling in case I ever had to use it on behalf of a client. It’s better than nothing. It’s case law precedent.

 

[Jon Stoppable]

Bear would add to human EA's response that the IRS standard is a "contemporaneous mileage log" showing trip details, miles, and odometer reading. Back in the day, that was written on paper, and if humans read the IRS' old tax audit guide, they look for repair receipts with odometer readings to confirm the log.

These days there are apps for that, but bear simply resets a trip odometer at the beginning of each day and takes a photo at the end.

Bear does not know why bear does that, because bears don't pay tax!

Ubear and Lyft will also provide a daily booked miles figure, which would hopefully not be too much less than total miles (bear tries for 70% booked). Bear thinks that the yearend summaries includes all miles online, rather than just booked miles, but bear is not certain about that!

Of course, if drivers have Ubear and Lyft active at the same time, the apps could be double-counting miles if the driver uses Ubear + Lyft mileage.

Hence, the log.

Publication 463 (2024), Travel, Gift, and Car Expenses | Internal Revenue Service

www.irs.gov

Table 5-1. How To Prove Certain Business Expenses

IF you have expenses for . . .​	THEN you must keep records that show details of the following elements . . .​
​	Amount​	Time​	Place or Description​	Business Purpose Business Relationship​

Transportation

Cost of each separate expense. For car expenses, the cost of the car and any improvements, the date you started using it for business, the mileage for each business use, and the total miles for the year.

Date of the expense. For car expenses, the date of the use of the car.

Your business destination.

Purpose: Business purpose for the expense. Relationship: N/A

 

[_Tron_]

Hmm. I have a separate car just for RS. So I keep no additional records, and just use the begin of year and end of year odometer readings. The difference is my annual RS mileage, and when the IRS form asks if my proof is "written" I answer yes.

If I were to be audited I have no idea if the IRS would accept my calendar year mileage for a vehicle dedicated to my Schedule C income. But if they disallowed it we sure as heck would go to court to let a judge decide.