As a click-and-ride partner/rideshare driver, the first thing that you need to keep in mind is that you’re not an employee – you’re an independent contractor. It’s awesome being a solopreneur – you work when you want and you make as much money as your car can afford you to. However, you also bear the brunt of your tax reporting. An independent contractor files taxes as a self-employed individual (4 times a year) and THAT also means that you’ve gotta keep an awesome record of your expenses.
It’s likely at the end of the year you receive a 1099 from your click-and-ride company (if you earned over $600) and you’re going to use this docoment to report your net income. The form you’d use to report this income is the Schedule C of Form 1040. Here’s one of the most important things I can drill into your head: you have HAVE to pay self-employment taxes on your net income. Just to be sure you heard me, read that last sentence again. Don’t forget to account for this or you could be in for a bam-pow from Uncle Sam. Your self-employment tax (Social Security and Medicare) is roughly 15% of your net income.
All in all, paying your taxes as a click-and-ride partner/rideshare driver isn’t the worst experience you can have – an audit is much, much worse. For our FREE REPORT on How to Pay Taxes as a Click-and-Ride Partner/rideshare driver, visit www.MillennialTax.com.