A person is driving for Uber. He gets in his car and turns on the Uber app. After some time, he gets a rider. He then drives to pick up the rider. After that, he gets another rider. He repeats this for 8 hours. At the end of the 8 hours he drives home.

It is my belief that all the driving he did is deductible as a business expense. Am I right about that?

I am in the United States.

  • 3
    "Driving" is not an expense. What expenses are you asking about? Wear and tear? Fuel? Jan 9 at 7:53
  • 1
    @Acccumulation I was thinking of the $0.53 per mile you can deduct.
    – Bob
    Jan 9 at 13:52
  • @Acccumulation Because of the mileage deduction, “driving” really is an expense, and it doesn’t need to be broken out any more than that, if you choose. Jan 10 at 0:30

In the United States a ride share driver is a part of the Gig economy. The IRS even has a Gig Economy Tax Center.

You will eventually find Pub 463. Travel, Gift, and Car Expenses.

It boils down to to options. a standard rate for every mile you drive for business, or calculating the actual expenses:

Actual car expenses include:

  • Depreciation
  • Licenses
  • Lease payments
  • Registration fees
  • Gas
  • Insurance
  • Repairs
  • Oil
  • Garage rent
  • Tires
  • Tolls
  • Parking fees

Regarding parking and tolls

Parking fees and tolls.

In addition to using the standard mileage rate, you can deduct any business-related parking fees and tolls. (Parking fees you pay to park your car at your place of work are nondeductible commuting expenses.)

You have to take careful records of the miles. I know that first miles, and last miles each day have to be addressed. I know that miles while waiting for the next customer have to be addressed also. I would review all the IRS items in the Gig economy tax center for more details.

  • 1
    Just one thing which would be worth clarifying in your answer. The OP also stated: "at the end of the 8 hours he drives home". In my jurisdiction that would be non-deductible as it part of getting to/from work rather than being part of the work itself. Would that be the case in the US too?
    – JBentley
    Jan 9 at 22:27
  • 1
    @JBentley I think they would need to contrive some reasonable "depot" to call their place of business, from which reasonable Uber business could be had. For instance if they live out a country road and must drive 10 miles to get to an area where you have a good likelihood of picking up a ride rapidly, then that. If you are at such a customer area and repositioning for a better customer area, that should be deductible. A real judgment call there, but "Uber advising you to do that" would be very favorable. Jan 10 at 0:33

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