considering a pricey new car....Uber to defray costs?

[mistymoney]

Has anyone done some very part time side ubering to get deductions for a car?

[Adventine]

Batsignal to @MustachioedPistachio who did it very briefly, ran the numbers and concluded it wasn't worth the time. He can give you more details.

[mistymoney]

thanks @Adventine!

[Syonyk]

Are your (total, depreciation included) operating costs far below other people?  Then it might make sense.  If they're not, or are higher, you're just cashing out depreciation on your car early, for a crappy hourly wage, dependent on the whims of an unstable tech company funded by venture capital ("We lose money on each ride, but we'll make it up in volume!"), run by... well, the sort of people who see no problem with disabling the automatic braking system on their self driving public road experiments, because their self driving system triggers them too often - and then can't detect a person crossing the road.

I've known a few people doing stuff like this profitably (based on their math, which in at least a few cases I believe is fully thought out).  One was using a used Gen 2 Chevy Volt, charging on low cost and free power (grid power at home is cheap, there are "free as in beer" charging spots around our area), and running people around.  He also did a lot of food delivery, but was exceedingly aware of his operating costs and would go home if it wasn't going to be worth running.  The other drove a... "fully depreciated car," doing food delivery and such, not carrying passengers.  And I don't think the car in question was actually safe to have on the road, having moved it around a driveway once.

If you're planning to use your free time to drive other people around to justify your shiny new car, you're planning to buy way, way too damned much car.  Buy a cheaper car, buy a used car a few years old, or literally anything else.  "I want this car, I can't afford this car, so I'm going to Uber!" is a sucker's game that many play, and Uber will even help you get loans to pay for it (or did), because then they have their claws in you.

Rethink your plan.  It's idiotic.  You're trying to buy too much car.

[uniwelder]

Has anyone done some very part time side ubering to get deductions for a car?

I’m trying to understand your question. Do you mean writing off the purchase as a business expense?  I don’t know anything about it, but based on your brief wording, it would be nice to clarify.

[mistymoney]

Are your (total, depreciation included) operating costs far below other people?  Then it might make sense.  If they're not, or are higher, you're just cashing out depreciation on your car early, for a crappy hourly wage, dependent on the whims of an unstable tech company funded by venture capital ("We lose money on each ride, but we'll make it up in volume!"), run by... well, the sort of people who see no problem with disabling the automatic braking system on their self driving public road experiments, because their self driving system triggers them too often - and then can't detect a person crossing the road.

I've known a few people doing stuff like this profitably (based on their math, which in at least a few cases I believe is fully thought out).  One was using a used Gen 2 Chevy Volt, charging on low cost and free power (grid power at home is cheap, there are "free as in beer" charging spots around our area), and running people around.  He also did a lot of food delivery, but was exceedingly aware of his operating costs and would go home if it wasn't going to be worth running.  The other drove a... "fully depreciated car," doing food delivery and such, not carrying passengers.  And I don't think the car in question was actually safe to have on the road, having moved it around a driveway once.

If you're planning to use your free time to drive other people around to justify your shiny new car, you're planning to buy way, way too damned much car.  Buy a cheaper car, buy a used car a few years old, or literally anything else.  "I want this car, I can't afford this car, so I'm going to Uber!" is a sucker's game that many play, and Uber will even help you get loans to pay for it (or did), because then they have their claws in you.

Rethink your plan.  It's idiotic.  You're trying to buy too much car.

I'm really not understanding this post. I never said I couldn't afford the car, I was just curious about defraying costs somewhat.

[mistymoney]

Has anyone done some very part time side ubering to get deductions for a car?

I’m trying to understand your question. Do you mean writing off the purchase as a business expense?  I don’t know anything about it, but based on your brief wording, it would be nice to clarify.

Yes, so I was thinking that you could write off some stuff on taxes. I have noticed a lot of ubers are really nice cars, so I was thinking this is what people might be do.

but I don't know if it is direct costs, the IRS mileage rate for business, wear and tear, or what it might be.

[uniwelder]

Has anyone done some very part time side ubering to get deductions for a car?

I’m trying to understand your question. Do you mean writing off the purchase as a business expense?  I don’t know anything about it, but based on your brief wording, it would be nice to clarify.

Yes, so I was thinking that you could write off some stuff on taxes. I have noticed a lot of ubers are really nice cars, so I was thinking this is what people might be do.

but I don't know if it is direct costs, the IRS mileage rate for business, wear and tear, or what it might be.

Good question. It’s something I’d like to know more about. I’ve always considered my truck a personal vehicle that I report the miles for standard IRS rate when used for my rental houses. Whenever I replace it, I should look into classifying it as a business expense that I occasionally using for personal driving.

[Telecaster]

Mr. MM did an article a while back about being an Uber driver:

https://www.mrmoneymustache.com/2017/11/22/mr-money-mustache-uber-driver/

I am pretty skeptical that being an Uber driver would significantly defray any costs.   For tax purposes, you can either deduct the actual expenses or use the IRS mileage rate.   I use the mileage rate and I think it is fair (maybe even generous) and simple, but for a pricey new vehicle that depreciates quickly it probably wouldn't be enough.   And of course you are giving up your time as well which you get paid for, but not very well.

Working part time for better pay would probably have a better impact on your finances than driving Uber part time.   If you need to drive Uber to justify the price of the car, then you probably can't afford it. 

[sonofsven]

Look into section 179 depreciation, you can get some pretty juicy deductions for placing a vehicle into service in your business.
The qualifications for business use are somewhat strict.
I'll be getting a nice deduction for buying a new work truck in 2022.

[MustachioedPistachio]

Has anyone done some very part time side ubering to get deductions for a car?

I’m trying to understand your question. Do you mean writing off the purchase as a business expense?  I don’t know anything about it, but based on your brief wording, it would be nice to clarify.

Yes, so I was thinking that you could write off some stuff on taxes. I have noticed a lot of ubers are really nice cars, so I was thinking this is what people might be do.

but I don't know if it is direct costs, the IRS mileage rate for business, wear and tear, or what it might be.

Do you currently commute to work?

You could possibly sign up with Uber/DoorDash/Lyft etc and simply turn on the app when you are leaving work. If you get pinged, then make a few bucks and claim the mileage as a business expense. If you don't get any rides, you can still claim the mileage :)

[mistymoney]

Has anyone done some very part time side ubering to get deductions for a car?

I’m trying to understand your question. Do you mean writing off the purchase as a business expense?  I don’t know anything about it, but based on your brief wording, it would be nice to clarify.

Yes, so I was thinking that you could write off some stuff on taxes. I have noticed a lot of ubers are really nice cars, so I was thinking this is what people might be do.

but I don't know if it is direct costs, the IRS mileage rate for business, wear and tear, or what it might be.

Do you currently commute to work?

You could possibly sign up with Uber/DoorDash/Lyft etc and simply turn on the app when you are leaving work. If you get pinged, then make a few bucks and claim the mileage as a business expense. If you don't get any rides, you can still claim the mileage :)

lol!

One thing I was thinking was if I need to pick up someone at the airport, I could try to find a fare nearby going to the airport.....

[mistymoney]

Mr. MM did an article a while back about being an Uber driver:

https://www.mrmoneymustache.com/2017/11/22/mr-money-mustache-uber-driver/

I am pretty skeptical that being an Uber driver would significantly defray any costs.   For tax purposes, you can either deduct the actual expenses or use the IRS mileage rate.   I use the mileage rate and I think it is fair (maybe even generous) and simple, but for a pricey new vehicle that depreciates quickly it probably wouldn't be enough.   And of course you are giving up your time as well which you get paid for, but not very well.

Working part time for better pay would probably have a better impact on your finances than driving Uber part time.   If you need to drive Uber to justify the price of the car, then you probably can't afford it.

ooo - thanks for this link, very informative! Everything seemed doable to me....until the decal on the windsheild! the next thing was not knowing where the fare was headed. Wonder if they've straightened that out!

The post didn't detail any tax benefits, so I wonder how those might fit in to making it a profit.

If you need to drive Uber to justify the price of the car, then you probably can't afford it.

I was just exploring options! On an aside: Justify is kind of a odd criteria - because a lot of people would buy a car they can't afford and do nothing whatsoever to justify the purchase, and others might be amply able to afford, and still make many cases of justification.

[mistymoney]

Has anyone done some very part time side ubering to get deductions for a car?

I’m trying to understand your question. Do you mean writing off the purchase as a business expense?  I don’t know anything about it, but based on your brief wording, it would be nice to clarify.

Yes, so I was thinking that you could write off some stuff on taxes. I have noticed a lot of ubers are really nice cars, so I was thinking this is what people might be do.

but I don't know if it is direct costs, the IRS mileage rate for business, wear and tear, or what it might be.

Do you currently commute to work?

You could possibly sign up with Uber/DoorDash/Lyft etc and simply turn on the app when you are leaving work. If you get pinged, then make a few bucks and claim the mileage as a business expense. If you don't get any rides, you can still claim the mileage :)

also i do not commute, or very rarely.....

[mistymoney]

Look into section 179 depreciation, you can get some pretty juicy deductions for placing a vehicle into service in your business.
The qualifications for business use are somewhat strict.
I'll be getting a nice deduction for buying a new work truck in 2022.

This might be something to look into! I live in dense urbia, so many of my car trips are pretty short, I don't commute, so would probably be pretty simple to make sure that slightly over 50% of miles are spent on uber, if I get over the sticker on the windshield issue, lol!

[mistymoney]

update:

I bought the car. It's nice and shiny. I realized I don't want to haul around stangers in it, who may have stepped on dog doo, could potentially vomit, or may have greasy hands. Especially for a very uncertain return.

Friend told me a friend's mother was ubering and reported making a lot of money. So that seems nice! But I remain uninterested, at least at the moment. Maybe when the car seems less new I'll change my mind.

[jrhampt]

Probably a good idea not to Uber.  If this is something you consider again, you should also factor in the insurance considerations.  I had a family member who ubered with their personal car, and when they got in an accident while ubering, I don't think their personal car insurance policy covered them.

[afox]

update:

I bought the car. It's nice and shiny. I realized I don't want to haul around stangers in it, who may have stepped on dog doo, could potentially vomit, or may have greasy hands. Especially for a very uncertain return.

You must not have kids!

[mistymoney]

Probably a good idea not to Uber.  If this is something you consider again, you should also factor in the insurance considerations.  I had a family member who ubered with their personal car, and when they got in an accident while ubering, I don't think their personal car insurance policy covered them.

total bummer! Seems perhaps something to disclose? But yeah - just another hassle, potential added expense, to the endeavor.

[mistymoney]

update:

I bought the car. It's nice and shiny. I realized I don't want to haul around stangers in it, who may have stepped on dog doo, could potentially vomit, or may have greasy hands. Especially for a very uncertain return.

You must not have kids!

Not under the age of 20 anyway!

I will say that when one of children started driving my previous vehicle alot as a teen, they were easily as messy as when they were a toddler! Except it wasn't confinded to the area around the car seat! Mainly due to starbucks type stuff......

[obstinate]

total bummer! Seems perhaps something to disclose? But yeah - just another hassle, potential added expense, to the endeavor.

It is almost certainly covered in the insurance policy. But people don't read those things.

[Finances_With_Purpose]

Great thought, but it's a terrible financial idea.  The numbers just aren't there.  You spend a lot in the car + maintenance + time; a lot of it isn't an up-front cost, but you're still burning the cash/value.  The real pay rate for something like that is very bad.  You'd be better off taking a low-wage side-gig and paying it on the car.