I’ve just passed my 28th weekly pay period.
To date
Just shy of 1900 rides (no badgers yet)
About $18000 gross pay
$13000 take home (Uber doesn’t withhold, I’ll owe taxes out of this)
deductables
Uber frees – $5200
Mileage allowance from IRS – 16000 x $0.54 = about $8000
Telephone and cleaning costs – $400
Total ACTUAL expenses – $2200
So right now I’m liable for an additional $4500 in taxable income above my full time state job.
I average 30 hours a week driving. Take home / hours is about $14/hour
Still enjoying it, still meeting and chatting with interesting people almost every day.
How exactly did you come up with the 4500 taxable income? And you are aware that the taxable rate for “self employment” is much higher than that for a regular job?
Good that you enjoy though.
Actual expenses are monies I have spent, which is $0 for “wear and tear”. The IRS deductible is supposed to cover depreciation, which it is more than doing.
I estimated 2 years of depreciation. I expect to drive aboutt 40000 miles a year compared to 12000 without Uber. After 2 years the resale value of my car with 24 k miles rather than 80k miles is $3300 more , or about $1600 a year.
Are you making your quarterly estimated tax payments? I’ve known several people who were paid as contractors who got burned big time on quarterly estimates. Even if you pay your taxes on time, there are substantial penalties for not paying them ahead of time.
In the OP’s case he is going to be replacing tires, doing additional repairs and buying a new car much quicker by doing Uber than if he did not do Uber.
I’ve seen other articles by Uber drivers and they kind of match your numbers. In looking at your overall take home $14.00 an hour is (IMO) kind of marginal when you are beating the shit (mileage wise) out of your car to get there. In many areas an educated adult can get $12-$14 an hour in a lot of part time jobs that don’t require you chewing up your car. What those jobs DON’T provide is time flexibility and your complete control over deciding to work or not as you wish.
Honestly (objectively) it doesn’t seem like that great a deal for you cash flow wise given the car wear and tear, but if there are no other options in your area and you like it, it’s better than sitting on your ass paying video games and drinking beer.
It looks pretty straightforward to me: 18000 (gross) -5200-800-400=$4400. (There’s a few “abouts” there, so I assume rounding to $4500.)
The $2200 he’s listing as “ACTUAL expenses,” I assume he means the actual cost of gas he paid for and cleaning and whatnot. (As opposed to the IRS mileage deduction, which takes into account wear and tear and whatnot, so there might not be any actual expenses incurred this year but down the line. So actual things he’s shelled out hard currency for now.)
You might be able to bump up your own withholding to cover what you’d pay quarterly - that’s how we did it when we had a nanny. It may differ when doing this kind of self-employment thing.
Also, with Uber do you need to pay the employer’s share of FICA and Medicare? If so that costs you another 7.65 percent (or whatever).
Is that paid on your net income (gross minus expenses) or gross?
Yes, I have an ebay hobby business selling footwear online. I buy closeout merchandise (often less desired sizes) and flip it. It chews up about 3 hours a day on average and yields about $ 30,000 net income annually after all expenses. I do the work in the evenings.
However …
1: I have to know very precisely that what I am buying will have a high probability of moving saleswise, and it took me almost 7 years of doing this to be able to make those determinations with a fair degree of success, and I *still *make mistakes on occasion. I had a number of expensive screwups when I started.
2: Unlike your ability to decide not to work if you choose once the merchandise is up for sale (and I have almost 500 SKUs) I’m on deck 24-7 and I have to ship in 24 hours and respond to customer inquiries ASAP to keep my gold plated satisfaction rating. Going out of town for more than 3 days is almost impossible. Like you I can choose when I want to work but I can’t choose (like you) not to work unless I close the store down or take it offline which would be a mind boggling PITA. You can’t just switch it on and off.
3: I have tens of thousands of dollars in debt tied up carrying this inventory.
4:Large sections of my house have become a warehouse for merchandise. I cannot entertain or have guests over while this situation persists. If I was married this scenario would not be possible.
So yes to the dollars for hours worked and time flexibility but there are big tradeoffs per the above.