Can You Claim Uber Rides to Work on Your Taxes?

The ability to deduct the cost of an Uber ride on your taxes is determined by the reason for the trip, not the use of a ridesharing service itself. The Internal Revenue Service (IRS) requires a travel expense to be both “ordinary and necessary” for your business or another qualifying activity. An ordinary expense is one that is common and accepted in your trade or business, while a necessary expense is one that is helpful and appropriate. This distinction separates a deductible business trip from a non-deductible personal expense.

The General Rule for Commuting

The Internal Revenue Service (IRS) has a clear rule regarding daily travel between your home and primary workplace: it is a non-deductible personal expense. This is known as commuting, and the associated costs are never deductible. This rule applies whether you are a self-employed individual traveling to your main office or an employee going to your job each day. The government’s position is that the expense of getting to and from your regular place of work is a personal living cost.

For instance, taking an Uber every morning from your home to your office is a commute. Even if the ride is necessary for you to get to work, the IRS does not permit a deduction for this expense or the return trip home. This principle holds true regardless of the distance or the mode of transportation used.

Deductible Business-Related Uber Travel

For the Self-Employed

For self-employed individuals, the scope for deducting Uber fares is broader, provided the travel is directly related to business operations and not a commute. For instance, if you operate your business from a home office that qualifies as your principal place of business, an Uber ride from your home to a client’s office for a meeting is a deductible travel expense. Travel between two different business locations, such as from your main office to a workshop or a secondary retail spot, is also deductible.

Other examples include trips to pick up business supplies or rides to an airport for a business conference. Travel to a temporary work location is also deductible, which the IRS defines as any place where your work is expected to last for one year or less.

For Employees

Due to the Tax Cuts and Jobs Act of 2017, most employees can no longer deduct unreimbursed business expenses, including Uber rides for work. If you are a W-2 employee and your employer does not pay you back for a business trip, you cannot claim that expense on your federal tax return. The most common way to handle these costs is through an employer reimbursement arrangement called an accountable plan.

Under such a plan, you submit documented expenses to your employer for reimbursement, and this reimbursement is not considered taxable income. For a plan to qualify, it must meet three conditions:

• The expenses must have a business connection.
• You must account for your expenses to your employer within a reasonable period.
• You must return any excess reimbursement within a reasonable period.

An exception to this rule exists for certain employees, such as Armed Forces reservists, who may still deduct some unreimbursed business expenses.

Other Scenarios for Deductible Uber Rides

Medical Travel

Uber rides taken for medical reasons can be included as a deductible medical expense. This includes travel primarily for receiving medical care, such as rides to and from hospitals, doctor’s offices, or a pharmacy to pick up a prescription. You can only deduct the total amount of your medical expenses, including these Uber fares, that exceeds 7.5% of your Adjusted Gross Income (AGI). For example, if your AGI is $60,000, you could only deduct medical expenses that are more than $4,500.

Charitable Travel

If you perform services for a qualified charitable organization, your out-of-pocket transportation costs can be considered a charitable contribution. This means the cost of an Uber ride to and from the location where you are volunteering is deductible. For example, if you volunteer at a local food bank and take an Uber there, the fare is a deductible expense. The charity must be a qualified organization recognized by the IRS, and while you cannot deduct the value of your time, you can deduct direct costs like the Uber fare.

Moving Expenses

The deduction for moving expenses has been suspended for most taxpayers. Currently, the only individuals who can claim a deduction for moving expenses are active-duty members of the U.S. Armed Forces. This exception applies if the move is due to a military order for a permanent change of station. For these qualifying military members, the cost of an Uber for travel related to the move could be included as part of their deductible moving expenses.

Recordkeeping and Claiming the Deduction

Information and Documentation

To claim a deduction for any Uber ride, you must maintain records to substantiate the expense. The IRS requires documentation made at or near the time of the trip. For each ride, you must prove the cost, date, destination, and business or other qualifying purpose. The Uber app keeps a detailed trip history with receipts that show the date, fare, and locations.

It is good practice to add a note to each business-related receipt specifying the exact purpose, such as “Meeting with client John Smith” or “Travel to Office Depot for printer ink.” Simply having a receipt is not enough; you must connect the expense directly to a deductible activity. You should keep these records for at least three years after filing your tax return.

How to Claim

The tax form you use depends on the reason for the deduction. For self-employed individuals, the total of all business-related Uber fares is reported as a travel expense on Schedule C (Form 1040), Profit or Loss from Business. This total is included with other business travel costs and directly reduces your self-employment income.

For deductions related to medical care or charitable work, you must itemize using Schedule A (Form 1040). Your qualifying medical travel is added to other medical expenses and is only deductible to the extent the total exceeds 7.5% of your AGI. The cost of Uber rides for charitable purposes is included with your other charitable contributions on a separate line of Schedule A.