Tax Deductions for Rideshare Drivers
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.
Winter Service Reminders: Maintenance tips for safe travels in 2020
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.
Ownership Smarts: Ways to finance your new Chevy SUV
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.