Can I Claim Uber Rides to Work on My Taxes?
Understand the principles that separate personal travel from a business expense to see if your Uber rides are a valid tax deduction.
Whether you can deduct the cost of an Uber ride to work depends on the nature of the travel. Tax rules distinguish between personal commuting and legitimate business transportation, and understanding this difference is the first step to determining if your expenses are deductible. The purpose and destination of each trip dictate its treatment by the Internal Revenue Service (IRS).
The General Rule for Commuting Expenses
The IRS is clear that the cost of commuting between your home and your main place of work is a personal expense and not deductible. This rule applies regardless of the distance you travel or the method of transportation you choose. Whether you drive your car, take a train, or use a ride-sharing service like Uber, the daily trip to your office is considered a personal choice.
For example, taking an Uber from your home to your office every morning is a non-deductible commuting expense, as is the ride home. These trips are not considered part of conducting your business; they are the prerequisite to beginning your work activities.
When Uber Rides Are Deductible Business Travel
While daily commuting is not deductible, many other work-related trips using Uber can be. The travel must be an “ordinary and necessary” expense directly related to your business or profession. This includes several scenarios where the cost of your ride is a legitimate business expense.
- Traveling between two different workplaces, such as from your primary office to a client’s location for a meeting or between two separate client sites.
- Traveling to a temporary work location, which is a place where your work is expected to last for one year or less. This travel is for a specific business engagement rather than a regular commute.
- Traveling from a qualifying home office to another business location. Your home office must be used exclusively and regularly for your business to qualify as your principal place of business.
- Taking local rides while on an overnight business trip away from your tax home. This includes trips from the airport to your hotel or from the hotel to a conference.
Required Recordkeeping and Documentation
To claim a deduction for business-related Uber rides, you must maintain records to substantiate the expense. The IRS requires contemporaneous documentation, meaning you should record the details at or near the time of the travel.
For every deductible ride, your records must include the cost of the trip, the date and destination, and the specific business purpose. While Uber receipts provide the date, cost, and route, they do not explain the business reason for the trip, which you are responsible for documenting.
A good practice is to keep a travel log or annotate your digital receipts immediately. For example, next to a receipt for a $25 ride, you might write, “Met with Jane Doe at ABC Corp to finalize project proposal.” A specific purpose is better than a general one.
You should retain these records for at least three years from the date you file the tax return. Keeping your annotated receipts and logs organized ensures you are prepared if the IRS questions your deductions.
How to Claim the Deduction on Your Taxes
The method for claiming deductible Uber expenses depends on your employment status. Self-employed individuals, like independent contractors, report business expenses on IRS Form 1040, Schedule C. Deductible Uber rides are reported on Line 9 for car and truck expenses. If the rides were part of an overnight business trip, the cost is included on Line 24a for travel.
For W-2 employees, the rules have changed. The Tax Cuts and Jobs Act of 2017 eliminated the deduction for unreimbursed employee business expenses for most taxpayers. This deduction is no longer available at the federal level.
If you are an employee and your employer does not reimburse you for a deductible Uber ride, you cannot claim it on your federal tax return. The way for employees to get a tax benefit for these costs is to seek reimbursement from their employer through an accountable plan.