Quick answer
Uber and Lyft report your gross fares, which include fees the platform keeps. You report the gross as income, then deduct the service fees and booking fees as business expenses. The result is the same taxable profit as your real payout, and your return matches the IRS copy of your 1099-K.
The biggest deductions for rideshare drivers in 2026:
- Mileage: 72.5 cents per mile January to June, 76 cents July to December.
- Platform service fees, booking fees, airport and city fees.
- Tolls and parking, phone, car supplies and passenger amenities.
You pay 15.3% self-employment tax plus income tax on what’s left.
Gross vs net: how Uber’s tax summary works
Riders pay more than you receive. The difference is Uber’s or Lyft’s cut plus pass-through fees.
Your annual Uber tax summary splits this into lines like:
| Tax summary line | What it means | Tax treatment |
|---|---|---|
| Gross fares or gross trip earnings | Everything riders paid for trips | Income |
| Tips | Tips from riders | Income |
| Uber service fee | Uber’s commission | Deductible expense |
| Booking fees, other fees | Passed through to Uber | Deductible expense |
| Airport fees, city fees, tolls | Charged to riders, paid through Uber | Deductible expense |
| Online miles | Miles driven with the app on | Helps support your mileage deduction |
The 1099-K shows the gross figure, not your deposits. If you report only your bank deposits, your income looks too low next to the 1099-K, and the IRS matching system may send a notice. Reporting gross and deducting fees avoids that.
Uber issues a 1099-K for trip earnings above $20,000 (some states lower) and a 1099-NEC for referrals and promotions. Lyft issues similar forms. See 1099-K Threshold 2026.
The core deductions
Mileage
For most drivers, mileage is the largest deduction by far.
| Period of 2026 | Rate |
|---|---|
| Jan 1 to Jun 30 | 72.5 cents per mile |
| Jul 1 to Dec 31 | 76 cents per mile |
Deductible miles include driving to pickups, the trip itself and moving between rides while the app is on. The “online miles” on your summary are a good starting point. Your own log is better, because it also captures work miles the app doesn’t see, such as driving to a car wash for the business. See Car Expenses: Mileage vs Actual.
The mileage rate replaces gas, insurance, repairs and depreciation. You can’t add those on top.
Expenses you deduct on top of mileage
| Expense | Notes |
|---|---|
| Uber and Lyft service and booking fees | From your tax summary |
| Tolls and parking during rides | Even with the mileage rate |
| Airport and city fees | From your tax summary |
| Phone and data plan | Business-use %. See Deduct Phone and Internet |
| Car loan interest | Business-use % |
| Water, mints, chargers, cleaning supplies for riders | 100% |
| Car washes | 100% if for the rideshare business |
| Dash cam, phone mount | 100% or depreciate |
| Rideshare insurance add-on | With actual expenses only |
Actual expenses instead of mileage
With the actual expense method, you deduct gas, oil, repairs, tires, insurance, registration, lease payments or depreciation, times your business-use percentage. It can win for a pricey car with few miles. For heavy drivers, mileage usually wins.
If you choose actual expenses in the car’s first business year, you can’t switch to mileage for that car later.
Worked example
Sam drives for Uber in 2026. He is single with no other job. His tax summary shows:
| Item | Amount |
|---|---|
| Gross fares | $45,000 |
| Tips | $4,000 |
| Uber service fee and other fees | $11,000 |
| Net payout (what hit his bank) | $38,000 |
His Schedule C:
| Line | Amount |
|---|---|
| Gross receipts ($45,000 + $4,000) | $49,000 |
| Fees paid to Uber | $11,000 |
| 9,500 miles Jan to Jun × $0.725 | $6,887.50 |
| 10,500 miles Jul to Dec × $0.76 | $7,980 |
| Tolls and parking | $400 |
| Phone (60% of $900) | $540 |
| Rider supplies and car washes | $300 |
| Total expenses | $27,107.50 |
| Net profit | $21,892.50 |
Sam owes about $3,093 in self-employment tax and about $340 in federal income tax after the standard deduction and QBI deduction. That’s about $3,430 total. Rideshare drivers are also on the IRS tipped occupation list, so his $4,000 of tips may qualify for the new tips deduction and cut his income tax further.
Without a mileage log, his profit would be $14,867.50 higher. Check your own numbers with the Self-Employment Tax Calculator.
What you can’t deduct
- Commuting from home to a fixed job site. Rideshare drivers rarely have one, but keep your log honest.
- Personal trips, even if the app happens to be on.
- Traffic and parking tickets.
- Gas and repairs if you use the mileage rate.
- Meals you eat on shift. These are personal.
Records to keep
The IRS wants proof. Keep:
- Your annual tax summaries and 1099s from each platform.
- A mileage log with date, miles and purpose, or an app export.
- Receipts for tolls, parking, phone and supplies.
- Records of your car’s total miles for the year (odometer at start and end).
Keep them at least three years. See Receipts and Records.
Frequently asked questions
Should I report my Uber income as gross or net?
Report the gross fares and tips, then deduct Uber’s fees. Your profit is the same either way, but gross reporting matches the 1099-K the IRS receives.
Are Uber service fees tax deductible?
Yes. Uber lists service and booking fees as potentially deductible business costs. They appear on your tax summary.
Can I deduct miles driven while waiting for a ride?
Generally yes, if you’re online and available in your working area. Driving far away for personal reasons doesn’t count.
I drive for both Uber and Lyft. Do I need two Schedule Cs?
No. It’s the same type of work, so one Schedule C can combine both. Don’t count the same miles twice when both apps are on.
This article is general information, not tax advice. Consult a CPA or Enrolled Agent for your situation.
Related guides
- Gig Worker Taxes: The Complete Guide for Uber, DoorDash and Instacart
- DoorDash Taxes: How Much Dashers Owe and What They Can Deduct
- Gig Worker Taxes: The Complete Guide for Uber, DoorDash and Instacart
About this guide
Written by the Freelancer Tax HQ editorial team, based on our professional experience, official US government sources (IRS, SSA and other agencies) and reputable informational articles listed in the sources below. Last reviewed on . Tax rules change often, and we update this guide when they do. Read our editorial policy or report an error.
Sources
Uber: Tax information for drivers and couriers; IRS: Gig Economy Tax Center; IRS Publication 463, Travel, Gift, and Car Expenses; IRS: Final regulations listing tipped occupations; IRS: 2026 tax inflation adjustments. Example figures are FreelancerTaxHQ illustrations.
Official resources linked in this guide: IRS: About Form 1099-K; IRS: Tax preparer credentials.