How Much Do You Have to Make on Uber to File Taxes?
Understand the tax implications of being an Uber driver. This guide clarifies filing thresholds and the process of reporting your net business profit to the IRS.
As an Uber driver, you operate as an independent contractor, a classification that changes your relationship with the tax system compared to traditional employees. This status means Uber does not withhold taxes from your earnings. Consequently, the responsibility for calculating and paying federal and state income taxes, as well as self-employment taxes, falls directly on you.
Determining Your Tax Filing Requirement
The requirement to file a tax return as an Uber driver is triggered by the self-employment income threshold. If you have net earnings of $400 or more from your driving activities after deducting business expenses, you are required to file a tax return. This rule applies even if that is your only source of income for the year.
This $400 net earnings rule is distinct from the general income tax filing requirements, which are based on your total gross income, filing status, and age. It is possible for your gross income to be below the general threshold for filing, but you would still be obligated to file a return because your net earnings from self-employment exceeded $400.
This self-employment rule ensures that contributions are made to Social Security and Medicare, a responsibility handled through self-employment taxes.
Essential Tax Forms for Uber Drivers
By January 31st, Uber provides drivers with tax documents accessible through the driver portal. The primary form you may receive is Form 1099-K. For the 2024 tax year, Uber issues this form to drivers who earned over $5,000 in customer payments. The amount on Form 1099-K represents the gross fares paid by riders, which includes Uber’s fees and commissions.
You might also receive a Form 1099-NEC if you earned $600 or more from non-driving activities like referral bonuses or promotions. Even if your earnings don’t meet the thresholds to receive these forms, you are still legally required to report all income earned.
To report this income and calculate your tax, you will use two schedules with your Form 1040. Schedule C, Profit or Loss from Business, is where you list your gross income and subtract business expenses to determine your net profit. This net profit figure then carries over to Schedule SE, Self-Employment Tax, to calculate the Social Security and Medicare taxes you owe.
Calculating Your Net Profit or Loss
When calculating your net profit on Schedule C, you subtract all “ordinary and necessary” expenses from your gross income. This includes the fees and commissions Uber takes, which are listed on the tax summary they provide.
The most significant deduction for most drivers is vehicle expenses. The IRS provides two methods for this: the standard mileage rate or the actual expense method. The standard mileage rate is a simplified option where you multiply your total business miles by a rate set annually by the IRS (70 cents for 2025). To use this, you must keep a detailed log of your business mileage.
The actual expense method involves tracking and deducting the business-use percentage of all your vehicle costs, including gas, oil changes, insurance, registration, and repairs. This method is more complex and requires meticulous record-keeping but may yield a larger deduction.
Beyond car expenses, you can also deduct other costs. These include a portion of your cell phone bill, tolls and parking fees, car cleaning services, and amenities provided to passengers like water or snacks.
How to Pay Self-Employment Taxes
The U.S. tax system operates on a “pay-as-you-go” basis, which for self-employed individuals means paying estimated taxes quarterly. You are required to make these payments if you expect to owe at least $1,000 in tax for the year after accounting for any withholding or credits. These estimated tax payments cover both your income tax and your self-employment taxes.
The payments are due on four specific dates: April 15, June 15, September 15, and January 15 of the following year. To determine the amount to pay each quarter, you must estimate your total annual income and expenses, which can be done using the worksheet on Form 1040-ES.
The IRS offers several convenient methods for submitting these quarterly payments. You can pay using IRS Direct Pay or the Electronic Federal Tax Payment System (EFTPS). Alternatively, you can mail a check or money order with a payment voucher from Form 1040-ES. Making these timely quarterly payments is necessary to avoid potential underpayment penalties when you file your annual return.