What income do you report?
All of it: fares, delivery fees, tips, bonuses and promotions, whether or not you receive a form. Platforms report on Form 1099-K for payments processed for you, at the federal threshold of $20,000 and 200 transactions, or lower state thresholds, and on Form 1099-NEC for other payments over $2,000. The 1099-K often shows gross fares before the platform's fees; deduct those fees as an expense. See Form 1099-K.
How does the mileage deduction work?
Business miles include driving with passengers or deliveries, driving to pickups, and driving between trips while logged in and available. Commuting from home to a regular place is not business, but most drivers have no regular workplace. For 2026, the standard rate is 72.5 cents a mile for January to June and 76 cents from July to December, applied to miles driven in each period. Alternatively, deduct actual costs. See mileage vs actual vehicle expenses.
Keep the log as you go: a log rebuilt months later from memory is much weaker if the IRS asks for it.
What else can you deduct?
| Expense | Notes |
|---|---|
| Platform fees and commissions | If included in the gross on your 1099-K |
| Phone and data plan | The business share |
| Tolls and parking for business trips | Deductible on top of standard mileage |
| Car washes, water and supplies for passengers | If you use actual expenses, or as supplies |
| Insulated bags and accessories for delivery | Supplies or equipment |
Roadside assistance, dashboard cameras and floor mats bought for the business are also deductible, in the same way.
Are tips taxable?
Yes. Under the 2025 tax law, qualified tips in occupations that customarily receive tips can be deducted for 2025 to 2028, up to $25,000 a year, reduced at higher incomes. Whether your work qualifies depends on the official list of tipped occupations, so check before claiming.
Even where the tips deduction applies, tips are still part of self-employment income for Social Security and Medicare.
How do you stay on top of the tax?
Track every business mile
With an app or log, including time logged in between trips.
Save part of each payout
For income and self-employment tax. See how much to set aside.
Pay quarterly estimates
April 15, June 15, September 15 and January 15. See estimated quarterly taxes.
Download platform tax summaries
At year end, and reconcile them to your records.
What if you deliver by bike or scooter?
The standard mileage rate is for cars, vans and trucks, not bicycles. Delivery workers who use a bike or scooter deduct actual costs instead: the business share of repairs, maintenance, insurance and depreciation of the bike, plus delivery bags and phone mounts.
What are the common mistakes?
- Reporting only the net payout, so income does not match the platform's Form 1099-K.
- Not tracking miles driven between trips and to pickups.
- Skipping quarterly payments and facing a large bill and penalty in April.
- Forgetting state and city taxes, where they apply.
Do drivers need an LLC?
No. Most drivers report as sole proprietors on Schedule C. An LLC adds liability protection for the business, but it does not change the tax on its own, and the platforms contract with you either way. See do freelancers need an LLC.
What does an example look like?
A driver earns $42,000 in 2026, with $6,500 of platform fees included in that figure. He drives 20,000 business miles, 9,000 from January to June and 11,000 from July to December. His mileage deduction is 9,000 × $0.725 plus 11,000 × $0.76, or $6,525 plus $8,360, which is $14,885. With fees and phone costs, his net profit is about $20,000, taxed for both income and self-employment tax.
Driving for an app?
We reconcile your platform statements, track your mileage deduction, prepare your Schedule C and set your quarterly payments.
Questions people ask
How are Uber and Lyft drivers taxed?
As self-employed: earnings go on Schedule C, business costs are deducted, and self-employment tax applies to the profit.
What is the 2026 mileage rate for rideshare drivers?
72.5 cents a mile for January to June 2026 and 76 cents from July to December.
Can I deduct miles driven to pick up passengers?
Yes. Driving to pickups and between trips while available is business mileage.
Do rideshare drivers pay quarterly taxes?
Usually yes, because no tax is withheld.
Sources
Every fee, date and rule on this page was taken from these official and primary sources.
Rules and fees change. If you are reading this long after October 1, 2026, confirm the figures with the source before you rely on them.
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This guide is general information. It is not tax or legal advice for your situation.