Articles, Blog

TurboTax + Uber: Tax Write-Offs for Rideshare Drivers [Webinar]

TurboTax + Uber: Tax Write-Offs for Rideshare Drivers [Webinar]

– Hey there, my name’s Alexis Hartford. I’m a tax expert here at TurboTax. So TurboTax is partnered with Uber to provide drivers like yourself an easy and educational way to file taxes online from the comfort of your own home or while you’re out and
about in-between rides. So in today’s webinar what I want to cover is everybody’s favorite topic, tax write-offs. Now being a rideshare driver means you can write off a slew of things and I’ll get into those in a little bit. So first we’re gonna talk about the tax write-offs. then I want to show you a little bit about how TurboTax works and how easy it is to put your expenses into the program. And then at the end I’m gonna leave time for any questions that you folks may have. So let’s get started. Being self-employed comes with a huge perk and those are your tax write-offs. One amazing thing about TurboTax is that we understand
what industry you’re in, you’re in the rideshare industry, and we actually personalize our experience based on the type of business that you do, which is rideshare driving. So the biggest deduction that a rideshare driver has is their car. So, as far as taking a car as an expense, it all starts with your mileage. The IRS requires that you keep great track of all of the miles that you drove throughout the year. This includes your business miles and your non-business miles as well. But what happens if you rideshare drive for multiple companies? Uber is not gonna keep
track of that for you. So what you want to do is you want to have a way to track all of your miles outside of the Uber app if you’re doing rideshare for other jobs. So this could mean that you should install maybe an outside app such as QuickBooks Self-Employed does a great job of tracking your miles. Therefore, you’ll have all of your miles tracked in one place. So we need to track our business miles and our personal miles. And the reason that we do this is because we want to know what business percentage that you were driving with Uber. So for example, if you have 50,000 miles all throughout the year for business and personal and let’s just say you
drove 25,000 with Uber, that means it’s 50% business use. That number will come in handy later when we actually put some expenses in. So, as far as the vehicle deduction there’s two ways that you
can actually take this. You can do what’s called standard miles and that is a set rate by the IRS, it’s 54.5 cents a mile for 2018. And you just take 54.5 cents a mile and times that by your business miles and that’s your tax deduction. You can also take what’s
called actual expenses. Now, this is a little more complicated because you need to keep track of all of your gas, all of the repairs, the maintenance. Did you get new tires on your car? How about some oil changes? So you want to keep track of all of those business expenses and add all of them up
at the end of the year. And then you want to look and see which one is higher. So if you otherwise qualify you’re gonna want to take whichever one provides the largest deduction. You’re not gonna have to figure that out. We’re gonna figure it out for you through TurboTax. I’m gonna show you exactly how to do that in a few minutes. So what happens if you don’t own your car? What if you’re participating in the Uber exchange program? You’re gonna be able to write off a business portion of that as well. You’ll find that expense amount on your 2018 tax summary. Your 2018 tax summary also contains multiple deductions that
you can also write off. Some things that are outside of your 2018 tax summary are your cell phone bill. Some refreshments. How about water for your passengers? What about your music subscription that you use to play in your car while you’re driving around? Car seat covers. How about an air freshener? We’re gonna walk through
the product right now and I’m gonna show you how to enter in all of this information. Okay, so let’s get started and get into the product. So you want to go to your Uber Partner Earnings dashboard and you want to select Tax
Information at the top. Now, this is an important
way to get inside TurboTax because you don’t want to
go to directly because your discount’s
not gonna be applied. So go ahead and select Tax Information and right here you’re gonna see an offer, File for Free. Go ahead and click the
Start for Free button. After you click Start for Free, you’re gonna come to this page where you’re gonna see two offerings. The first offering is
TurboTax Self-Employed. That’s the do-it-yourself program where TurboTax walks you
through screen by screen asking you extremely simple questions which I’ll demonstrate in a minute. So our second offering
that we have available is TurboTax Live. This is if you want a
little extra assistance with your tax return. You can contact a tax pro like myself to actually review and
answer any questions that you have about your return. We’re offering this to
Uber driver partners for half price so it’s only $85. We’re gonna go ahead and get started with the TurboTax
Self-Employed program for free because you can always
upgrade along the way if you feel like you need that little extra assistance. So if you’ve used our product in the past what you want to do is select Sign In and just put your username
and password in there and we’ll transfer all of the information that you have from last year into this year’s program. If you’re new to TurboTax, welcome and just go ahead and say Start for Free, and then create an account profile with your username and password. So once you get into the TurboTax program, we’re gonna walk you through
very simple questions to get your tax return set up. We’re gonna ask for your
name, your birthdate, where you live, what
your mailing address is. And then you’re gonna
get to the self-employed income expenses section. So, in the previous
webinar, I talked about how to enter in some income and set up your business. In this webinar, we’re gonna focus on those tax write-offs. So because you told TurboTax that you’re a rideshare driver previously, it’s gonna go ahead and personalize this entire write-off experience for you based on the industry that you’re in, which is rideshare driving. So let’s take a look at
some of the common expenses. So vehicle. This is the biggest deduction that you’re probably gonna have. You’re gonna go ahead and enter in your car and equipment rental here. We’ve got communications. This is where you’re gonna enter in your business portion of your cell phone. We have supplies, such as the refreshments for your passengers. If you have to pay any city taxes, you’re gonna go ahead and enter those in down here. And then we have all of
those Uber operational costs that are reported out in
your 2018 tax summary. So you’ll enter those under Other miscellaneous expenses. So, why don’t we go ahead and walk through the Vehicle flow, and I’m gonna show you how easy it is to put in your vehicle. So go ahead and select Vehicle. And then it’s gonna ask you if you used a car for your rideshare driving work. Well, of course you did. So go ahead and say Yes there. And then we’ll put in what type make and model car you have, and what type of vehicle it is. And when did you start
using this for work? We’re gonna say that we did it in 2017. And we’ll just go ahead and continue. So, do you own the vehicle,
are you leasing it? Select whichever one pertains to you. And then, was it available for personal use as well? So do you have multiple cars? If you don’t, then this vehicle was available for personal use. Did you keep track of the miles that you drove for rideshare work? This is a very important question and I’m hoping that everybody is gonna select Yes on this one because you are required to keep track of all of the miles that you
drive for rideshare work, whether or not it’s on
a mileage tracking app like QuickBooks Self-Employed. Maybe you use a spreadsheet at home. Maybe you just use a pen and paper. However you feel most comfortable tracking your miles, it doesn’t matter. The most important thing to remember is that you have to track your miles. So yes, I tracked my work miles. Alright, and here we go
about entering your miles. So earlier I told you we needed all miles, business and personal, and we also need just business. This is where this is
gonna come into play. So enter the total miles that you drove for any reason. This includes personal,
work, commuting miles. So let’s go ahead and put in here about 25,000 miles. The second entry is where you enter your business miles that you’ve been tracking all year long. So go ahead and put in your business miles into this box. Okay, let’s move ahead. We’re gonna answer a couple more questions about our car. And then it’s gonna ask you if you took the standard mileage deduction last year. This is a pretty important question. If you transferred in your
tax return from last year, we’re gonna have that answer for you. If you didn’t use TurboTax
last year, that’s okay. Just go ahead and click on this button that says Where can I find this info? And it’s gonna give you
very clear instructions on where to go in your
last year’s tax return to look for it. So we’re gonna go ahead and say Yes, I took the standard mileage deduction in this example. Okay, so here we are. It shows us that we have
a $3200 tax deduction just for our miles. We haven’t even put in any other expenses so this is great. So you have the option of sticking with the standard mileage right now. Most rideshare drivers just go ahead with the standard deduction. It’s a lot less record keeping. You don’t actually have to keep receipts for all of the gas and the oil changes and the repairs you’ve made to your car. If you have kept all of those items and you want to see
exactly how you compare from standard versus actual, go ahead down this flow and you can enter in all
of your actual expenses, and TurboTax is gonna tell you exactly which one is gonna be more beneficial for you. But in my example today,
we’re gonna go ahead and stick with the
standard mileage deduction because $3200 is a great write-off. So go ahead and select Continue. Here we are with a couple more questions about that vehicle. We’re gonna ask about parking fees, tolls. Did you pay any car registration fees? You’re able to deduct a
portion of that as well. Maybe you have a loan on your car. You can deduct the business
portion of the interest that you paid on that car loan. Remember, if you need any help on how to figure out these items, just go ahead and click on the Learn more. Okay, so we’re all done
with our vehicle expenses. So let’s go and look at what other types of expenses rideshare
drivers like yourself could have as well. Just click this button
Add expenses for work. Here are some other common expenses that rideshare drivers have. Communications, that’s a huge one. So everybody needs their cell phone in order to drive with Uber. What about supplies? Did you have cell phone accessories like did you buy chargers for your car? What about car seat covers to protect your car? Your other big tax write-off is gonna be under here, under Other miscellaneous expenses. So you want to go ahead and pull out your 2018 tax summary from Uber. This is where you’re going to see most of your expenses related to Uber. You’re gonna see Uber
service fees down here, you’re gonna see booking fees, airport fees, city fees. These are all tax deductible items. You want to write all of those off. So this is where you’re gonna put them in under Other miscellaneous expenses. When you get into the Other
miscellaneous expense section, it’s gonna guide you up here for exactly what you can write off. So just make sure that you’re matching these words right here with what’s on your 2018 tax summary. So if you have Uber service fees, go ahead and put those
guys right in over here. You can add another row. Let’s say you have a music subscription. To Spotify. Add that guy in over here as well. So after you’re done
entering all of your expenses just come out to your
rideshare driving info, make sure everything looks correct. We have your income, we
have all of your expenses. You’re gonna hit Done
and you’re good to go. It’s as easy as that. So that wraps up the product demo. Now it’s time for viewer questions. Okay, so now it’s time
to take some questions from you guys about your expenses. I’m gonna turn it over to Molly. – Alright, first up. I forgot to track my mileage. What should I do? – Okay, so first of all don’t freak out if you didn’t track your miles. What you want to do is
stop what you’re doing and start tracking them right now. And there’s plenty of apps out there. QuickBooks Self-Employed has a great one for tracking your miles. So, let’s just say that you started preparing your taxes and
it’s asking for miles and you’re like, “Whoops, forgot to track “my miles for last year.” There’s a couple of different ways that you can actually handle this. You can go to your 2018 tax summary. Uber is gonna give you
a set of miles there. So you can go ahead and use those miles. That would be the very,
very conservative approach. The better approach would be for you to try to reconstruct exactly how much you drove last year. Now, you’re gonna have a rider history so that you can go back through and figure out exactly how many miles you rode for each day. And then just extrapolate that out throughout the year. So that’s probably the safer bet as well. The last thing you want to do is try to make up any miles. So just make sure that
you actually have proof of what you’re doing to back it up just in case a question
ever comes from the IRS. – You mention standard mileage and actual expenses. How do I know which auto deduction option is best for me? So in product we actually have a really cook feature that will predict which one is better. You just have to answer a couple of simple questions and then that way you can decide if it’s worth tallying up all your receipts or not. Okay. I have instant pay charges on my statement so I don’t have to wait to get paid. Can I deduct that? – So, as far as your instant pay goes, that’s gonna be listed out on your 2018 Uber tax summary and yes, you can go ahead and write those off as an expense. – Alright, next up. I rented a car for a few months. Can I claim standard mileage? – So, as far as taking
the standard mileage, no, you can’t do that because you don’t actually own the car. But I’m gonna show you
where you can actually write off some of those
car rental expenses. So you want to scroll down past Vehicle because this Vehicle section is if you actually own the car. You want to look down here under Car and equipment rental. So go ahead and select that, hit Continue, and then in this section right here you can put in the expenses that you paid for the business portion of the rental. Now, you’re gonna find that amount on your 2018 tax summary that Uber provides for you. Another perk about actually renting a car is that you can write off the gas that you paid for the business portion of this rental as well. So just make sure that you have all those gas receipts, total them up, take the business use portion and enter them here. – Yep, and in order to
get the business use make sure you’re keeping track of all your personal trips and mileage so that you can easily calculate it. I had to pay for a car inspection and background check so that I can drive with Uber. Are these deductible on my tax return? – Yes. Absolutely those are deductible. You just want to go down into the miscellaneous expense section and put your background
check information there. Let’s just say you had to get thumbprint so you put that information there also. That’s a good question. – Okay, here’s a good one. What if I took actual expenses on my 2017 tax return? Can I claim standard
mileage for this tax year? Unfortunately not. If you chose actual
expenses in your first year, you’re stuck with that method as long as you use that vehicle. So again, there’s the estimator tool in the product that will tell you which is better and you can make the decision at that point. Okay. I just bought a new car and I paid a lot in sales tax because I live in California. Can I write that off? – Okay, so that’s a little bit trickier of a question. So the question about sales tax. Earlier I was talking about you can either take standard mileage, which is that 54.5 cents a mile for 2018, or you can take your actual expenses, which is your gas, your
tires, your maintenance, all of those items added up, and then you take the
business use portion. So the sales tax fits into that actual expense category. It’s actually gonna be added to the cost of your car
and then depreciated over a certain period of time. So TurboTax walks you through that flow and you’ll be able to enter your sales tax in the actual expenses flow. – Alright. We just have the time
for a few more questions. I heard there are increased auto depreciation deductions for 2018. That is true. Tax Cuts and Jobs Act actually has expense up to 18,000 if you use your car 100% for business. So keep in mind, the more
you drive it personally the less your deduction will be but that is the maximum that you could potentially take. – Molly, that actually
brings up a good point too, which I wanted to talk about. With the Tax Cuts and Jobs Act they also instantiated this 20% business deduction that everybody is talking about. So what that is, it’s a 20% deduction off of your actual taxable income. So if you otherwise qualify, and I’m not gonna get into it right now because it’s a very complex tax topic, but if your income’s
within a certain range, you don’t have employees, et cetera, you will be able to qualify for that 20% deduction so that’s a great question. – It’s more money in your pocket. Yeah. Alright, last one. I have a supplemental insurance policy required for my rideshare driving gig. Is that deductible? – Okay. So your supplemental insurance policy. A lot of rideshare companies, actually I think all of them, require supplemental
policies if you actually have passengers driving in your car. So since you only have
that supplemental policy because you’re a rideshare driver, yes, go ahead and write
off that entire amount. – Alright, that about sums it up. – We have no more time for questions but if I didn’t get to yours, or if you have any additional questions, go ahead and put it in the channel. And thank you so much
for joining us today.

Tagged , , , , , , , , , , , , , , , , , , , , , , , ,

14 thoughts on “TurboTax + Uber: Tax Write-Offs for Rideshare Drivers [Webinar]

  1. Do i need to use self-employed if i have a w2 and only a little bit of income from uber? i got a tax summary but it's small…

  2. Can I still file free if I have A Rental Property too? So i have w2s, 1099 misc an Rental property!

  3. I did already my 2018 Tax return using as usual TT Deluxe. I do have W-2 forms as wel, I started driving fo UBER last year in June. Just discovered this FREE self employed version. Would you recommend to redo my taxes on this SE version or I'm OK to file with TT Deluxe. Thank you.

  4. I do not have a generic problem. I cannot submit taxes until I find out how to delete a form that no longer applies.

  5. Are we required by law to file quarterly taxes for Uber (in my case). I am fairly new to that platform (started April 2019); and haven't received a 1099 as of yet. So should I wait until the annual/traditional tax season (when I receive my 1099 from Uber) to then file? Please answer. Thanks in advance.

Leave a Reply

Your email address will not be published. Required fields are marked *