The rise in freelance workers and on-demand services has brought about a new challenge for professionals in these fields: taxes. Like Lyft drivers and other on-demand workers, Uber drivers must self-report all the income they’ve earned for the year through the app.
Uber drivers must file taxes as self-employment income, which differs from the taxes of traditional workers. Instead of using a W-2 to report income, self-employed professionals must use a 1099 when filing taxes. Uber drivers fall under the rules for a 1099-K for their driving services and a 1099-MISC for any other payouts (e.g. new city bonuses, mentoring, referral fees, etc.).
Uber actually does not have to send out 1099-K’s to anyone who made under $20,000 and received less than 200 payments for driving services; they also don’t have to send a 1099-MISC to anyone who made under $600 in referrals. However, they choose to send 1099s so that driver partners remember to file taxes and have a clear summary of their earnings.
Follow along as we outline how to read your Uber 1099 and report it in your taxes.