Turo Host Taxes in Washington - 2026 Guide

Updated for 2026 (Filing 2025 Taxes)

Tax Essentials for Turo Hosts in Washington

Sharing your vehicle on Turo provides a flexible income stream, especially in a state known for its diverse landscapes and outdoor adventures like Washington. However, alongside the benefits comes the responsibility of accurate tax reporting. Revenue earned through Turo is generally considered self-employment income, requiring diligent record-keeping and adherence to both federal and state tax regulations.

The IRS requires Turo hosts to report their earnings on Schedule C (Profit or Loss from Business) as part of their Form 1040. This income is subject to both income tax and self-employment tax, which covers Social Security and Medicare taxes. Platforms like Turo do not withhold these taxes, meaning hosts are responsible for calculating and paying them, typically through estimated tax payments throughout the year.

How Washington Handles Gig Worker Taxes

Washington is famous for not having a personal income tax, but it has a Business & Occupation (B&O) tax. For most gig workers, including Turo hosts, your gross income won't be high enough to owe B&O tax, but you should be aware of the threshold. The B&O tax is a gross receipts tax, meaning it’s applied to the total revenue before any expenses are deducted. Currently, the threshold for requiring a B&O tax account is $25,000 in gross income. Even if you don't meet the threshold, it's prudent to understand the rules. The Washington Department of Revenue offers detailed guidance on B&O tax for service businesses, and it’s recommended to review their resources to ensure compliance. Additionally, Washington State does not have a sales tax requirement for car sharing services like Turo, simplifying the tax landscape compared to some other states. Keep meticulous records of all income received through Turo, as this information is crucial for both federal and potential state tax obligations. Consulting with a qualified tax professional familiar with Washington state tax laws is always advisable, especially as your Turo business grows.

You can find more information on the Washington State Department of Revenue website: https://dor.wa.gov/

Top Tax Deductions for Washington Drivers

• Standard Mileage: The #1 deduction. The 2025 rate is 70 cents per mile. Given Washington’s often-higher gas prices, carefully consider if the standard mileage rate or actual expense method yields a greater deduction.
• Tolls & Parking: While Washington doesn’t have extensive toll roads, any tolls incurred during Turo rentals (e.g., for airport access) are deductible. Parking fees directly related to vehicle pick-up and drop-off for rentals are also deductible.
• Phone & Data Plan: The percentage of your phone and data plan used for managing your Turo business (communication with renters, managing bookings, etc.) is deductible. Keep a log of business-related usage.
• Vehicle-Related Costs: Expenses like car cleaning supplies, phone mounts for renters, portable chargers, or even small amenities provided to renters are deductible as ordinary and necessary business expenses.

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

Self-employment tax is comprised of Social Security and Medicare taxes. When working for an employer, these taxes are split between the employer and employee. As a self-employed Turo host, you are responsible for the full 15.3% on net earnings exceeding $400. This is in addition to your regular income tax liability. Accurate record-keeping of income and expenses is vital for calculating this tax correctly.