Tax Deductions for Rideshare Drivers
Photo: SPUR
As January gradually draws to a close, it’s normal to start thinking about tax form submissions. Whether you endure filling out this annual form or take a strange pleasure in doing so, tax breaks are definitely something that helps make tax season a bit more palatable. If you’re a rideshare driver, here are a couple of deductions you won’t want to miss as you fill out this year’s tax return.
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Standard mileage deduction
According to Autoblog, one tax deduction the IRS offers might eliminate all taxable income you receive from your rideshare job. For any work-related miles you drove during 2019, the IRS is allowing you a $0.58 per mile deduction. And for miles driven in 2020, this rate is $0.575 per mile. The deduction applies to miles traveled when you have a passenger in your vehicle as well as the miles traveled between passenger pick-ups.
Pass-through income deduction
Yet another write-off you should take advantage of has to do with “pass-through” income. Autoblog defines pass-through income as monetary gain that you receive through a small business that you own. Thanks to a new law that Congress passed in 2017, small business owners can now claim a 20-percent deduction on pass-through income. And it doesn’t matter what type of small business you have; the deduction applies to sole proprietorships, partnerships, and S corporations.
If you’re a current rideshare driver, make sure to take advantage of these two write-offs on your taxes this year. If you’re thinking of becoming a rideshare driver in 2020, these deductions can help persuade you to take a leap of faith as you embark on this new adventure and start raking in some cash.
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Whitney Russell resides in Dayton, though her spirit can be found beach-bumming in Puerto Rico (the land of her half-Puerto Rican heritage). When not crafting car-related content, she can be found chasing after the most amazing toddler in the world, watching her “beaver” of a husband build amazing woodworking projects, hanging out with two crazy dogs, and visiting family and friends. She also enjoys traveling, crafting, and binge-watching period dramas when time allows. See more articles by Whitney.