Uber Driver Taxes in Rhode Island - 2026 Guide

Updated for 2026 (Filing 2025 Taxes)

Tax Essentials for Uber Drivers in Rhode Island

Navigating the scenic routes of Providence and Newport as an Uber driver offers flexibility, but also brings tax responsibilities. As an independent contractor, earnings from Uber and other gig platforms are considered self-employment income, requiring careful tax planning.

The IRS requires Uber drivers to report their income on Schedule C (Profit or Loss from Business) with 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 earnings. Accurate record-keeping throughout the year is essential to maximize deductions and ensure compliance.

How Rhode Island Handles Gig Worker Taxes

As a resident of Rhode Island, filing a state income tax return is mandatory, even if no federal tax is due. Rhode Island employs a graduated income tax system, meaning the tax rate increases as your income rises. For the 2025 tax year, self-employed individuals will primarily use Form RI-1040NR to report their income and calculate their state tax liability. Rhode Island also requires the Schedule RI-1040-IC, which is used to calculate income from self-employment. It's important to note that Rhode Island conforms to many federal deductions, but it's crucial to verify specific rules as they can differ. The state also offers various credits and deductions that may be applicable to Uber drivers, such as those related to business expenses. Rhode Island’s Division of Taxation provides detailed information and resources for self-employed individuals. Failure to file and pay state income tax can result in penalties and interest. Keep meticulous records of all income and expenses to accurately complete your Rhode Island tax return. The state also has specific rules regarding estimated tax payments, which may be required if you anticipate owing more than $1,000 in state income tax.

For more information, please visit the Rhode Island Division of Taxation: https://www.tax.ri.gov/

Top Tax Deductions for Rhode Island 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 expense tracking significantly.
• Tolls & Parking: Rhode Island drivers frequently encounter tolls on I-95 and other major routes. These tolls, along with any 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, etc.), you can deduct the percentage of your monthly bill attributable to business use.
• Vehicle-Related Costs: Expenses like car washes to maintain a professional appearance, phone mounts, dash cams, and insulated food bags (if delivering) are all potentially deductible business expenses.

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

Understanding the 15.3% Self-Employment Tax

This tax comprises Social Security and Medicare taxes. Unlike traditional employment where these taxes are withheld from your paycheck, as an independent contractor, you are responsible for paying both the employer and employee portions. This totals 15.3% on net earnings exceeding $400. Remember to factor this into your tax planning throughout the year.