As an experienced entrepreneur and tax professional, I get it: taxes are stressful. If you’re going to play the self-employment game, though, you gotta be ready to ace it. The hustle of driving and working for yourself, great customer service (for good ratings) and taxes, you have to do it all. I know it’s not easy – believe me, I’ve been at this for years. It’s especially hard for click-and-ride partners and rideshare drivers because the industry is so new.
Here’s how you should be paying taxes as a click-and-ride partner/rideshare driver.
A “perk” of being an independent contractor is that you now are responsible for withholding your own taxes. Did you know depending on how much you earn, you may be required and need to pay taxes more times a year? If you earn over $600 for the year as a rideshare driver, you’ll need to report the additional income to the IRS, but if you earn more than that, you might need to pay estimated quarterly taxes. Ah, the joys of independence. The fun part is there are a ton of potential deductions you can claim. Some of them are things you’ve probably never even considered, like water and tissues for your passengers. You’ll only be able to maximize your tax savings if you keep good books and records. Deductions and good records are like sneakers and shoe laces – you need both.
All in all, paying your taxes as a click-and-ride partner 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), visit www.MillennialTax.com.