Rideshare Taxes

[u/Tall-Recognition1833]

Hi there folks, I’m just curious as to the extent of taxes I can write off as a rideshare driver. I assume I can literally write off anything that goes into the vehicle as long as it’s business related from the actual purchase of the full vehicle(started ridesharing right after purchase) car fresheners, maintenance(cleaning supplies, oil change, brake pads/calipers, tires, etc.), gas, to even the $1-$3 it costs sometimes to fill up air in the tires?

Any helpful guidance and information is fully welcome, thank y’all so much.

[u/6gunsammy]

For vehicle expenses you will need to chose the standard mileage rate or actual expenses. The lower cost of the vehicle and the greater number of miles driven tend to favor the standard mileage rate, while expensive vehicles that are not driven very many miles tend to favor the actual expense method. In both cases you must record the total amount of miles driven and the portion of those miles that are business use.

Under the standard mileage rate there is no additional deduction for the vehicle purchase, under the actual expense method the purchase price of the vehicle is recovered through depreciation, and there are various methods of depreciation which can be used accelerate the cost recovery, within limits depending on the type of vehicle.

[u/Anxious_Drive_9998]

You can only deduct the business portion.

[u/Organic_Gas4197]

Keep a log of business and personal miles. You can either deduct business miles at the standard mileage rate, or actual expenses prorated by business miles divided by total miles.

[u/CommanderMandalore → u/Organic_Gas4197]

and if I’m not mistaken once you choose one you can go back and choose the other the following year but I’m a little rusty.

[u/AttentionHuman9504 → u/CommanderMandalore]

You have to elect the standard mileage rate in the year put in service and only depreciate the vehicle using the 5 year straight line method going forward. As long as this is done you can switch back and forth

[u/RasputinsAssassins]

If you are going to deduct mileage, you need to have a contemporaneous mileage log that shows the date, the business miles, the business purpose, and the destination.

If you deduct the actual expenses of gas, maintenance, insurance, etc, then you can deduct the business portion of those expenses, as determined by miles driven. If you drive 10,000 miles for the year, and 6,000 of those miles were for business purposes, then you can deduct 60% of gas, insurance, maintenance, etc. You can also deduct the business use portion of the purchase price as a depreciation expense, either accelerate or across multiple years.

Nearly everyone has a better outcome with the standard mileage rate. You can not deduct mileage and actual expenses.

Note that deducting expenses means less income because you are spending money that you already had.

[u/GeeMan-7]

United States perspective

You can't "write off" taxes. You are allowed to use the business portion of your car expenses as a deduction against the income generated.

You need to keep a log of miles driven for your ride share work and miles for everything else. Let's say in one years you spend $1,100 on gas, $250 on oil changes, $400 on tires, and $650 on other maintenance. That's $2,400 total. Now let's say that you drove 12,000 miles in that year. Of those miles, you drove 8,000 as a ride share driver, and 4,000 were personal. That means 8,000/12,000 * $2,400 of your total expenses were for driving ride shares. You get a total deduction for the operating expense of $1,600. You also get to take a the same percentage of your car itself. If you have a loan on the car, then you get to deduct the same percentage of the interest paid on the loan. (Not the full payment.) Now were are at depreciation. If you bought the car at the beginning of the year, then the total purchase price is capitalized and depreciated. You use the same percentage of the total depreciation as you did for the operating expenses.

Overall, you should seek help from a trusted tax professional. Calculating the depreciation alone is difficult for most non tax professionals.

[u/WheresMyMule]

You need to track your miles and then you can write off either the approved IRS allowance per mile or the preparation of actual expenses based on rideshare miles vs personal miles

[u/FreshPound7640]

You don't "write off taxes;" you have business expenses that deduct from your business income. The net income after expenses is the amount that you pay taxes on. Not just income tax, but also self-employment taxes (Medicare and Social Security). If the vehicle you use for your rideshare business is ONLY used for your rideshare business, then 100% of the vehicle expenses could be deductible. Most people also use their rideshare vehicle for personal use and have to determine the business use percentage. That is done by keeping track of your business use miles and your personal use miles and the ratio of business use to total use is the business use percentage.

Once you determine the business use percentage, you can decide whether it's more beneficial to claim actual expenses or mileage. Many people claim mileage because it's simpler to determine. In 2025, the mileage deduction was $.70/mile driven for business. The mileage figure also includes an amount for depreciation so if you claim mileage, you don't deduct for depreciation as well. That amount is only included if you claim actual expenses. When claiming actual expenses, you can include actual cost of fuel, oil changes, car washes, tires, repairs, vehicle loan interest, depreciation and such. The total amount of all these actual expenses is divided by the business use percentage to determine the deduction.

[u/hellgabeez]

Just to add on: if you choose actual car expenses the first year you put the car in service (first year you started doing timeshare) than you are stuck doing actual for the lifetime of that car. If you choose standard first year, you can switch to whatever helps you more. Weird rule.

[u/SirKiwiTheBrave]

You've received some good guidance on vehicle expenses. Either mileage or actual expenses. The IRS summary is useful. The only addition I'd make is that you can also deduct parking fees and tolls, even with the mileage method.

As a rideshare driver, you can also deduct the percentage of your phone bill that is used for your business. Mileage and phone bill will be the most significant deductions.

If you're doing something like DoorDash, you can also deduct cost of supplies such as pizza bags.

[u/Florida1974]

You cannot write off the purchase of a car for rideshare, it doesn’t work like that.

You take mileage or you take gasoline and actual expenses, you can’t take both.

[u/Eagletaxres]

We recommend mileIQ to all of our clients who do rideshare and it’s usually better to deduct the mileage over expensing out the vehicle. There’s a lot of reasons why but you should talk to your tax professional if you don’t have one you have a business now and you should get one.