Your online miles can factor into one of your largest tax deductions, which is the business use of your car. If you are using TurboTax Self-Employed, check out " How do I enter my Lyft tax information?" for step-by-step instructions.ĭeducting mileage and auto expenses: a driver’s largest tax deduction These are just the beginning of your business expenses. It also includes the miles you drove while online. This includes the Lyft fee, tolls, and other fees discussed above. To jumpstart your business tax deductions, Lyft provides you with totals for some business expenses on your Driver Dashboard. If this amount is $400 or more, you’ll enter it on Schedule SE, which is used for calculating your Medicare and Social Security taxes (self-employment tax).The difference goes on line 31 of Schedule C and on your 1040.To calculate the profit for your business, you’ll subtract your business expenses from your income.You’ll also use Schedule C to list your business expenses. You’ll report this income using Schedule C, Profit or Loss from Business. Reporting your self-employed business profitsĪs an independent self-employed business owner-known as a sole proprietor-you’ll pay taxes on the profits you earn from your ridesharing business. Read How To Use Your Lyft 1099s for a breakdown of how to use them to complete your tax return. Whether you receive a 1099 or not, it’s your responsibility to determine what you should report as taxable income. It’s ok if your Tax Information doesn’t include everything listed-not all drivers have the same forms and expenses. Your driver earnings will be posted online or mailed to you by January 31. If you did not reach these income thresholds, you can find a detailed breakdown in your Annual Summary from your Driver Dashboard ( sign in to your account, look under the “Driver” heading, and select “Tax Information”). If you earned at least $600 from non-driving earnings, such as referrals and bonuses, you should receive a Form 1099-NEC (1099-MISC in years prior to 2020).There is no threshold for payment card transactions such as credit card swipes.Beginning in 2023, if you generated transactions paid through a third-party payment processor totaling more than $600 you should receive a Form 1099-K.This is the IRS requirement, however, you are likely to receive a Form 1099-K in the mail even if you have fewer transactions with less gross receipts. For tax years before 2023, the threshold is more than 200 transactions and more than $20,000 in gross ride payments from passengers during the year.Instead, you’ll receive this type of information on your Driver Dashboard or on one or more Forms 1099 that will be mailed to you, depending on how much you earned. As a self-employed individual running your own business, you will not receive a W-2 from Lyft that details your ridesharing earnings for the year.
0 Comments
Leave a Reply. |
Details
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |