Lyft Driver Taxes in Oklahoma - 2026 Guide

Updated for 2026 (Filing 2025 Taxes)

Tax Essentials for Lyft Drivers in Oklahoma

Navigating the bustling streets of Oklahoma City or Tulsa as a Lyft driver offers flexibility, but also brings tax responsibilities. As an independent contractor, earnings from Lyft are considered self-employment income, requiring careful tracking and reporting to both the federal government and the State of Oklahoma.

The IRS requires Lyft drivers to report their income on Schedule C (Profit or Loss From Business) with Form 1040. Crucially, income exceeding $400 necessitates the payment of self-employment taxes, covering both Social Security and Medicare contributions. Platforms such as Lyft do not withhold these taxes, making proactive tax planning essential.

How Oklahoma Handles Gig Worker Taxes

As a resident of Oklahoma, a state income tax return is required, regardless of income level. Oklahoma utilizes a graduated income tax system, meaning the tax rate increases as your income rises. For the 2025 tax year, Oklahoma’s tax brackets are expected to remain similar to prior years, ranging from 0% to 5.00% depending on your taxable income. Lyft drivers operating within Oklahoma will report their self-employment income on Form 540, Oklahoma Individual Income Tax Return, and Schedule 540, Self-Employment Income. Oklahoma also allows for a standard deduction, which can reduce your taxable income. It's important to note that Oklahoma does not offer a specific deduction for the federal self-employment tax paid, but it is deductible when calculating your adjusted gross income on your federal return, which then impacts your Oklahoma state tax liability. Oklahoma also has a use tax that may apply to vehicle purchases or significant modifications. Keeping meticulous records of all income and expenses is vital for accurate filing. For the most up-to-date information and forms, please visit the Oklahoma Tax Commission website: https://www.ok.gov/tax/

Top Tax Deductions for Oklahoma Drivers

• Standard Mileage: The most popular and often most beneficial deduction. For the 2025 tax year, the standard mileage rate is 70 cents per mile. Given Oklahoma’s generally lower gas prices compared to states like California or Washington, utilizing the standard mileage rate is often a highly advantageous strategy for maximizing deductions.
• Tolls & Parking: While Oklahoma doesn’t have extensive toll road networks, any tolls incurred during Lyft trips are deductible. Parking fees directly related to picking up or dropping off passengers are also deductible.
• Phone & Data Plan: You can deduct the percentage of your phone and data plan that is used for business purposes. Keep a log of business-related calls and data usage to support this deduction.
• Vehicle-Related Costs: Expenses like car washes, air fresheners, phone mounts, first-aid kits, and insulated food bags (for delivering food via Lyft) are deductible as ordinary and necessary business expenses.

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

Understanding the 15.3% Self-Employment Tax

This tax comprises two components: 12.4% for Social Security and 2.9% for Medicare. Because Lyft and other gig platforms do not withhold these taxes from your earnings, it’s crucial to estimate your tax liability throughout the year and make quarterly estimated tax payments to the IRS and the Oklahoma Tax Commission to avoid penalties.