Uber 1099 Tax Form: What You Need to File?

Taxation is a necessity that must be noted by all. However, it can be daunting to deal with in many regards. Uber, too, doesn’t allow rideshare drivers or employees working under it to evade taxes. So, you need to know how to deal with Uber 1099.

This article will clarify information about Form 1099, how Uber drivers can file taxes, which method can be used for noting expenses, and what deductions are associated with the job. It will help you manage your taxes and pick rides without a glitch.

So, Let’s get started!

What Taxes do you need to Pay as a Rideshare Driver?

As an Uber driver, you are required to pay two types of taxes. First, is your federal and state income tax, and second, is a self-employment tax.

Federal and State Taxes

On one hand, the federal tax rates you need to pay can be set in a range from 10%-37%. On the other hand, the state tax rates can be anywhere from 0%-10.75%. Your taxable amount depends on the state you reside in and your tax bracket, which is constituted based on your annual earnings.

Self-Employment Taxes

The Internal Revenue Service (IRS) considers all drivers under Uber as independent contractors, and not as its employees. In other words, you have your own driving business and Uber withholds no taxes for you.

You need to pay Federal Insurance Contributions Act (FICA) taxes as an independent contractor on your self-employment income. It includes Medicare and Social Security taxes, where the former tax rate is 1.45% and the latter’s rate is 6.2%. As you are working independently, you also need to pay the employer’s portion of the tax. All these taxes (FICA taxes and employer’s taxes) amount to 15.3%.

And, you are still expected to pay taxes on time! So, you can use any tax professional who can guide you to have proper planning for your Uber taxes.

Now let’s understand what Form 1099 is.

What is Uber 1099?

Uber 1099 is simply the standard Form 1099 issued by IRS regulations to help workers serve taxes. It is not specific to Uber and applies to all independent contractors working on different platforms. You can receive either a Form 1099-K or a Form 1099-MISC/1099-NEC, which varies based on your previous year’s earnings and the number of rides (i.e. transactions) within that period.

When will you Receive Form 1099 From Uber?

Uber, similar to all other US companies having independent contractors as workers, has to submit 1099 forms and W-2 forms for freelancers and employees, respectively. These forms must be sent to respective workers by January 31st. Sometimes companies like Uber can delay filing the forms as per IRS instructions. However, it cannot delay more than the mentioned date so that employees and independent workers have enough time to file their tax returns.

What Type of Form will you Receive as an Independent Rideshare Driver on Uber?

As stated earlier, you will receive any of the 1099 forms as an independent contractor. These forms are:

• Form 1099-K: You will receive a Form 1099-K only if you earn more than $20,000 and have more than 200 transactions (or rides) with Uber in the last year. The rides are acceptable even if they are Uber Eats deliveries.

Even though there were talks about dropping the earning amount to $600, IRS delayed the change resulting in no transition in the current form 1099-K requirements.

• Form 1099-MEC/1099-NEC: You can receive either Form 1099-MISC or Form 1099-NEC in the following year if you earn more than $600 in ridesharing income (not delivery) through referrals. However, Form 1099-MISC is replaced with Form 1099-NEC in 2022. Thus, it is likely that you will receive Form 1099-NEC for your taxes.

• Tax Summary: You will require to fill this summary form annually as well to let IRS know your gross income from Uber. It also lets you document minimum business expenses that you can depreciate from taxes. It will be highly beneficial when you deduct your expenses to lower your total taxable income.

Where can You find Your Uber 1099 Form?

Uber tax summary and other forms are usually available by January 31. It can be accessed if you follow the following steps:

Step 1. Access the Uber website drivers.uber.com.

Step 2. Go to the Tax Information tab on the Driver Dashboard.

There, you can find your tax information. However, in case you can’t find it, you must contact the company’s support team who can confirm your tax form receiving details.

How can You File Your Uber 1099 Forms?

You can file your Form 1099 as long as you earn more than $600. You are still required to report your earning to the IRS even if you earn less than $600. Now, at tax duration, you can file using simple steps:

Step 1. Check your income information on your 1099 forms.

Step 2. Select either the actual expenses method or the standard mileage method to deduct your car expenses.

Step 3. Accumulate all your business expenses records.

Step 4. Fill out your Schedule C (Profit and Loss from Business form) using that information, which you will attach to Form 1040 (Personal Federal Income tax returns).

Now that you are aware of the forms that you should fill out, also know the deductions for expenses you can apply and the methods that are most suitable for you.

How can You Write off Your Business Expenses?

Once you gather all business expenses, you need to fill up your Schedule C form that identifies your business loss or profit. In that case, you need to select a method to depreciate your car or business expenses. The two methods and the deductions you can receive from them are described below:

Actual Expenses Method

The actual expense method includes the actual costs of your business, which are the costs associated with running your vehicle. Remember, you can only add the time you are using your vehicle for delivery or rideshare as a percentage. The expenses for personal usage are not acceptable. The deductions that apply to this method are:

• Fuel (gas and oil)
• Insurance (it also includes your Uber Insurance)
• Maintenance and repairs for the vehicle
• Vehicle depreciation
• Lease payments for vehicles

You must have receipts of all the expenses related to your business to claim these deductions.

Standard Mileage Method

This method enables you to deduct a flat rate for every mile you will drive for work. The amount is transitional and changes every year. For instance, in 2022, it was $0.585 for January to June, and $0.625 for July to December. The IRS takes this decision to mitigate the high rise in the price of gasoline.

Which is the Best Method for You?

The method of expense deduction can depend on the frequency of your work. The actual expense method is highly preferable for independent contractors who drive as a side gig and have 9-5 work hours. As the freelance work is strictly for a fixed time, the estimations of the costs will be easy and beneficial for the contractor.

But, if you work solely as a ride-share driver or delivery driver; the standard mileage method would suit you the most. It will allow you to enjoy a lot of tax savings.

What are the Other Deductions you can Apply?

Apart from the ones mentioned before, you can also include the following list of tax deductions.

• Uber commissions and service fees
• Roadside assistance plans
• Parking and toll fees
• Rider supplies such as food and water
• Educational materials such as ebooks for digital courses
• Delivery packages for Uber Eats
• Mobile phone accessories and a part of your mobile phone
• Music services such as online streaming sites

Note that some of these expenses are challenging to separate from your personal use. In this regard, specification is highly significant.

For instance, suppose you use your mobile phone for 80% of your working hours. So, you can deduct 80% of your phone bills, and the price of your phone. However, any cell phone accessory you use for your business can be entirely deducted.

Now, the question of when to file your taxes and pay them is crucial. So!

Should You File Uber taxes Quarterly or Annually?

For most self-employed workers, tax day occurs quarterly, i.e. four times a year. However, whether you can pay annually or quarterly is decided based on your yearly earning. If your owed amount is greater than or equal to $1000, you have to pay it quarterly, else it can be paid annually.

The deadlines for quarterly tax payments are:

• April 15- First Quarter
• June 15- Second Quarter
• September 15- Third Quarter
• January 15- Fourth Quarter

Be aware that you must pay your taxes on time if you are paying quarterly. Why? Because interests will be stacked on your original tax bill and will continue to grow if ignored.

Moreover, you will be penalized up to 90% of your due tax, while the quarterly tax penalty can rise to 25%. The best way to avoid all these shreds is to focus on exceptional tax management and planning. A professional’s help is always recommended.
However, if you feel you can’t align with it, you can visit and check the Self-Employed Individuals Tax Center at the IRS.

Uber 1099 forms are as essential as your business because it enables you to consider your tax responsibilities. However, all related information about these taxes can be confusing. Hopefully, this article will clear all the doubts that you may have in your mind regarding tax payments.

If you are still unsure of the information mentioned here, you can always approach our experts for a more accurate understanding.

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