Uber Driver Taxes in San Diego, California - 2026

Updated for 2026 (Filing 2025 Taxes)

Tax Essentials for Uber Drivers in San Diego, California

Navigating the vibrant streets of San Diego as an Uber driver offers flexibility, but also brings unique tax responsibilities. As an independent contractor, earnings from driving are considered self-employment income, requiring careful tracking and reporting to both the IRS and the California Franchise Tax Board (FTB).

The IRS requires Uber drivers to report their income and expenses on Schedule C (Profit or Loss from Business) when filing their federal income tax return (Form 1040). Crucially, this income is also subject to self-employment tax, covering both Social Security and Medicare taxes, which are not automatically withheld from your Uber earnings. Accurate record-keeping throughout the year is essential to maximize deductions and minimize tax liability.

How California Handles Gig Worker Taxes

As a resident of California, a state income tax return is required, even if no federal tax is owed. California has a graduated income tax system, meaning the tax rate increases as your income rises. This means your tax bracket, and therefore your tax rate, will depend on your total taxable income for the year. The primary form for self-employed individuals to report income and calculate tax liability is Form 540. California also requires you to pay estimated taxes quarterly if you expect to owe $1,000 or more in taxes for the year. This is because taxes aren't automatically withheld from your Uber earnings. Failure to pay estimated taxes can result in penalties.

San Diego drivers should be particularly mindful of potential expenses related to operating in the city. Parking costs, especially near popular destinations like the Gaslamp Quarter or beaches, can add up. While deductible, these costs need to be meticulously tracked. Furthermore, the high demand for rides during events at Petco Park or the San Diego Zoo can lead to increased mileage, impacting your deduction calculations. California’s FTB offers resources specifically for independent contractors, including information on estimated taxes and deductible expenses. It’s important to stay updated on any changes to California tax laws that may affect gig workers. The FTB website is a valuable resource: California Franchise Tax Board.

Top Tax Deductions for San Diego, California Drivers

• Standard Mileage: The #1 deduction. The 2025 rate is 70 cents/mile. Given California’s consistently high gas prices, especially in San Diego County, carefully consider whether the standard mileage rate or the actual expenses method will yield a larger deduction.
• Tolls & Parking: San Diego doesn’t have extensive toll roads, but parking expenses, particularly downtown and near tourist attractions, are significant and fully deductible. Keep all receipts!
• Phone & Data Plan: The percentage of your phone and data plan used for Uber driving (e.g., navigation, driver app) is deductible. Maintain a log of business use.
• Vehicle-Related Costs: Expenses like car washes to maintain a professional appearance, phone mounts, dash cams, and insulated food bags for deliveries are deductible.

Key Warning: You cannot deduct both the standard mileage rate and actual car expenses like gas or repairs in the same year. Choose the method that results in the largest deduction.

Understanding the 15.3% Self-Employment Tax

This tax covers both Social Security and Medicare, and it’s important to remember that Uber, or any other rideshare platform, does not withhold these taxes from your earnings. You are responsible for calculating and paying this tax, typically through quarterly estimated tax payments to the IRS.