Today, we’re going to walk you through how to prepare for filing taxes as a Lyft driver.
We’ll tell you the forms you need, how to maximize your tax write-offs, if you owe quarterly taxes, and if your tips are taxable income.
Our goal is to make your self-employed tax prep easy and straightforward, and walk you through the prep process step-by-step—let’s dive in!
There are various forms you’ll need to file your taxes. Let’s get organized!
To file taxes as an Lyft Driver (a.k.a. an independent contractor), you’ll need to fill out the following forms:
You’ll report income through the standard tax return, Form 1040. You’ll use Schedule C to list your income and expenses (and expenses = write-offs!). Plus, there may be additional state and local tax forms you’ll need as well—check with your tax service or professional.
You should receive your income information from Lyft. This may come in the form of:
Note: You’re still required to report your rideshare and delivery income to the IRS even if you don’t receive a 1099.
Lyft provides a tax summary that should show the total amount passengers paid for fees, like tolls, book fees, etc.—these are business expenses deductions to list on your Schedule C and deduct.
You can write-off miles you drove waiting for a trip, en-route to a rider, and on a trip. However, it’s crucial to keep careful and detailed records of off-trip mileage ( a mileage tracker like Everlance makes this easy and automatic!).
There are two ways to calculate your mileage deduction:
Do you use the same car for work and personal transportation? If so, then you’re required to keep detailed and accurate records that separate these uses. If you don’t have mileage logs, receipts, or other documentation, the IRS may disallow any business expenses you list. That’s why a mileage tracker is so important (Everlance is the #1 mileage and expense tracker, and it makes mileage logs easy and automatic!).
You are required to have a smartphone in order to do rideshare or delivery—so certain phone costs count as business expenses! Expenses that are deductible can include:
Do you use the same phone for work and personal? If so, then you’re required to keep detailed and accurate records that separate these uses. Many Lyft drivers end up buying a new phone that is only used for their business. Then, this business phone’s costs are deductible.
Many costs associated with ridesharing and delivery can qualify as a write-off. In addition to work mileage and phone costs, other common deductions include:
Remember, Everlance doesn’t offer tax advice. Please refer to your tax professional or service for more information about your specific deductions.
Since you’re an independent contractor, you might be responsible for estimated quarterly taxes—especially if Lyft is your sole source of income.
Make sure to pay estimated taxes on time. Each quarter, you're expected to pay taxes for that quarter's payment period. Here are the due dates for 2023:
Your tips are part of your gross earnings total and are taxable income. Talk to your tax professional or service for more specific answers regarding your specific tax situation.
If you found this guide helpful, share it with your fellow Lyft drivers! Our goal is to make Lyft driver tax prep easy and straightforward.
We hope that you found this guide useful! Happy filing!
We recommend that you seek guidance from a qualified tax professional or service like Block Advisors or contact an independent tax professional for information about your specific tax situation. If you’d like to learn more, the IRS website has information about the 1099-K, 1099-NEC, and 1099-MISC.