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How To File Your Uber Tax With Or Without 1099 (Tax Calculator for 2021)

It's important for Uber drivers to know how to file their tax. This article shows how to file Uber drivers tax with or without 1099 (Tax Calculator for 2021)
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If you've heard how much Uber drivers make and decided to up your side hustle game by driving for Uber, you'll also want to look into the easiest way to pay your taxes as an independent contractor.  

Even if you've previously reported self-employment revenue, ridesharing is a distinct business with its own set of problems and opportunities.

However, paying your taxes to the IRS, is easy as long as your have the right tools.

Everyone working as an Uber driver either as a side hustle or full-time job should know where they stand, taxwise.

In the following sections, we'll provide some simple tips to make sure you stay on top of your taxes as an Uber driver.

What Is A 1099?

A 1099 is a tax document that is used to record various sorts of non-employment income to the IRS. It takes care of matters relating to investment, royalties, rentals, and non-employee work.

It is a series of documents referred to as ‘’information returns’’ by the Internal Revenue Service.

1099 forms are often used to report supplemental income.

This includes sources dividends, interest, payments from the government, and much more. The 1099 form is due at the beginning of every year as it contains the report from the preceding year.

The form 1099 reflects the amount due for Uber Driver tax. 

Types of Forms: 1099

There are different types of 1099 forms, depending on the income. The types of these forms are listed and described below:

  • 1099-A: Covers loan-related matters.
  • 1099-B: Covers proceeds from stock or service exchanges via bartering.
  • 1099-C: It reports debt cancellation of $ 600 and above.
  • 1099-DIV: It is used to report dividends and other earnings from financial institutions.
  • 1099-NEC: This is used to report miscellaneous payments during the year.       

How Do 1099s Differ From Other Tax Forms?

1099s are used to report a taxpayer's non-employment income.

They are also used to report cash dividends received for stock ownership or interest generated from a bank account. Other tax forms, such as W-2s, show the amount of taxes deducted from your paycheck for the year.

Independent contractors, including Uber drivers, receive 1099s to report their earnings to the IRS. Because they are self-employed, they fall under a specific reporting status.

When a company has workers it designates as employees, W-2 forms must be used to report wages paid. Any employee (rather than a contractor, for example) must get a W-2 form, regardless of how little work is done or the rate of pay, including wages and bonuses.

Why You Need To Pay Taxes For Uber

Uber drivers are termed independent contractors and therefore are required to accurately report their income. Drivers need to pay taxes for because the following reasons:

Uber drivers, unlike employees, do not have their taxes withheld by Uber. They are their own boss and therefore are expected to file the necessary tax returns.

1099-NEC forms are given to Uber partners (drivers) to report income from referrals along with other related bonuses.

 

What Tax Breaks Are Available For Uber Drivers

Uber tax breaks are deductions made from the income earned at the time of tax remittance. These help to cover business costs. There are various tax deductions available to Uber drivers, whether that work is full-time or is a side hustle. Both categories are taxed and can also qualify for the deductions provided.

Some of the tax deductions available to Uber Drivers include:

  • Mileage Deduction

With the use of mileage apps, Uber drivers can accurately track the mileage covered to claim the due mileage benefits accrued for the distance covered.

This can serve as compensation for the wear and tear on Uber drivers' vehicles.

  • Snacks

There are categories of snacks that are deductible, especially if they were consumed during working or driving hours and it can be proved that they were necessary and ordinary.

Other deductions that an Uber driver can lay claim to are:

  • Mobile phone bills
  • Roadside assistance
  • Tolls on highways, freeways, and bridges
  • Office supplies
  • Flashlights and flares
  • Any other expenses incurred as a result of operating the vehicle.

If You Drive For Uber And Lyft, What Do You Need To Do?

There are things expected from everyone who agrees to be an Uber or Lyft driver. This important exercise will not only help to keep you and your passengers safe but will also help you to earn a high rating.

The list of obligations of drivers for Uber and Lyft includes but is not limited to:

Dash Cam

This is a safety tip that keeps visual and audio records of all activities that transpire between the driver and passenger. It also captures footage and can serve as defensive evidence in the case of wrongful accusations.

Mount Your Cell Phone

Drivers are not allowed to operate cell phones while on the road, yet a phone is needed to locate passenger pickup and drop-off points. It is therefore essential that a hands-free Smartphone be mounted for easy visibility, access and operation.

This is important for the safety of both the driver and passengers.

Other expectations from Uber and Lyft drivers are:

Smartphone charging block

Cleaning towels

Covid-related protections and precautions

Air fresheners

Vomit bags

Sanitary wipes

First aid kit

Spare tire

What Is The Best Place To File Taxes?

Several applications can be used to hasten the process of filing task returns. Some of these programs also help maximize claimed benefits and refunds.

Our recommended filing software is TurboTax.

As a Uber driver, you can access TurboTax filling special offers on your driver dashboard.

TurboTax is known for its accuracy, detailed guidance for tax filing. It also guarantees maximum rideshare deductions, allowing you to keep more of the money you earn as a driver.

Other places to file your tax are TaxAct, Credit Karma Tax, H$R Block, and TaxSlayer.

How To File Uber Driver Tax When Form 1099 Is Not Issued

Usually, 1099s are sent by Lyft and Uber to reflect the total income paid to you from the previous year as well as how many deductions were made.

Where you receive over $600 in other payments, the 1099- NEC is issued and you will also receive the 1099-K if you exceed $20,000 in income in the course of making 200 or more trips (deliveries or rides).

Sometimes when the income is below $20,000, the 1099 form may not be issued and therefore a manual approach will be required to get the information.

Here is what to do when form 1099 is not issued

  • Sign in to your return
  • Select Federal
  • Select ‘’wages & income’’
  • Select ''self-employment''
  • Fill in all the necessary information

 

Uber Tax Calculator

The Uber tax calculator is used to calculate what is due for payment by the end of the tax year. The tax rate for self-employment is 15.3% on the net income and it covers 2.9$ to Medicare and 12.4% to Social Security.

The net income is the total gross income minus total expenses incurred. 

Conclusion

It's not difficult to obtain and fill out your Uber driver tax information. If you've never worked as a sole proprietor or self-employed individual before, you'll need to pay attention to the details of this article. Also, see our article on best credit cards for Uber drivers and the best tips for Uber drivers if you want to save more money.


Andrew Wise. Side Hustling since 2009
Andrew Wise, Side Hustler Since 2009
Founder, Wurk.cc
I have spent my entire adult life maximizing my money. At age 6, I was selling my lunch, at age 16, I was a Power Seller on eBay, and at age 26 I was helping Postmates manage their $10M annual Adwords budget. Today, I'm helping gig workers maximize their money on Wurk.
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