Uber Driver Taxes in New York - 2026 Guide

Updated for 2026 (Filing 2025 Taxes)

Tax Essentials for Uber Drivers in New York

Navigating the bustling streets of New York City as an Uber driver offers flexibility, but also brings unique tax responsibilities. As an independent contractor, earnings from Uber and other gig platforms are considered self-employment income, requiring careful tax planning and reporting.

The IRS requires all Uber drivers to report their income on Schedule C (Profit or Loss From Business) when filing their federal income tax return. Crucially, this income is also subject to self-employment tax, which covers both Social Security and Medicare taxes. Platforms like Uber do not withhold these taxes, meaning drivers are responsible for paying them directly to the IRS, typically through estimated tax payments throughout the year.

How New York Handles Gig Worker Taxes

As a resident of New York, filing a state income tax return is mandatory, even if no federal tax is owed. New York utilizes a graduated income tax system, meaning the tax rate increases as income rises. For the 2025 tax year, New York self-employed individuals will primarily use Form IT-201, Resident Income Tax Return, to report their earnings and calculate their state tax liability. It's important to note that New York also has a separate tax for the Metropolitan Commuter Transportation District (MCTD), which applies to residents of New York City and surrounding counties. This tax is reported on Form IT-201-A. New York also requires estimated tax payments if your tax liability is expected to be $1,000 or more. Failure to make timely estimated payments can result in penalties. The New York State Department of Taxation and Finance provides detailed guidance and resources for self-employed individuals; a comprehensive overview can be found at https://www.tax.ny.gov/. New York also allows for certain business expense deductions that can reduce your taxable income, mirroring many of the federal deductions available to self-employed individuals. Keep meticulous records of all income and expenses to ensure accurate reporting and maximize potential tax savings.

Top Tax Deductions for New York Drivers

• Standard Mileage: The most popular deduction for Uber drivers. For the 2025 tax year, the standard mileage rate is 70 cents per mile. This simplifies record-keeping, as you don't need to track every gas receipt.
• Tolls & Parking: New York City drivers accumulate significant toll expenses, particularly using bridges and tunnels operated by the MTA. These tolls, along with parking fees incurred while actively driving for Uber, are deductible.
• Phone & Data Plan: If you use your phone for Uber-related activities (navigation, accepting rides, communication), you can deduct the percentage of your monthly bill attributable to business use.
• Vehicle-Related Costs: Expenses like car washes, phone mounts, dash cams, first-aid kits, and insulated food bags (if delivering) are all deductible as business expenses.

Key Warning: You cannot deduct both the standard mileage rate and actual car expenses (gas, oil, repairs, insurance) in the same tax year. Choose the method that yields the larger deduction.

Understanding the 15.3% Self-Employment Tax

The 15.3% self-employment tax is comprised of two parts: 12.4% for Social Security and 2.9% for Medicare. Because Uber and similar platforms classify drivers as independent contractors, they do not withhold these taxes from your earnings. Therefore, it is your responsibility to calculate and pay this tax, typically through quarterly estimated tax payments to the IRS. The threshold for self-employment tax applies to net earnings over $400.