Lyft Driver Taxes in Idaho - 2025 Guide

Updated for 2025 (Filing 2024 Taxes)

Is Lyft Driver income taxable in Idaho?

Yes, income earned as a Lyft driver is absolutely taxable, both at the federal and Idaho state levels. The IRS considers you self-employed, meaning you're essentially running your own small business. You'll report your Lyft income and expenses on Schedule C (Profit or Loss From Business) as part of your federal Form 1040. This schedule calculates your net profit (income minus expenses), which is then factored into your adjusted gross income (AGI).

Idaho has a flat income tax rate for 2024, currently at 5.8% (this rate is subject to change, always verify with the Idaho State Tax Commission). Your net profit from Schedule C will be added to your other income, and this total taxable income will be multiplied by 5.8% to determine your Idaho income tax liability. Idaho also requires you to file an Idaho Form 40.

Top Tax Write-offs for Lyft Drivers

As a self-employed Lyft driver, you can significantly reduce your tax burden by claiming eligible business expenses. Here are some key deductions:

• Mileage: This is often the largest deduction! For 2024, the standard mileage rate is 67 cents per business mile driven. Keep a detailed log (date, starting/ending location, business purpose) to substantiate your mileage claim. You cannot claim both mileage and actual expenses (like gas, oil, repairs) – you must choose the method that yields the larger deduction.
• Vehicle Expenses (Alternative to Mileage): If you choose to track actual expenses, you can deduct the cost of gas, oil changes, repairs, maintenance, insurance, vehicle registration fees, and depreciation (or lease payments). This requires meticulous record-keeping.
• Lyft-Related Software & Apps: Expenses for apps used specifically for driving (e.g., Stride Tax, Everlance, GPS navigation apps) are deductible.
• Phone Expenses: You can deduct the portion of your cell phone bill that is directly related to your Lyft driving activities. If you use your phone for both personal and business purposes, you can only deduct the business percentage.

The 15.3% Self-Employment Tax Surprise

When you're an employee, your employer pays half of your Social Security and Medicare taxes. As a self-employed individual, you're responsible for both the employer and employee portions – a combined 15.3% self-employment tax. This is calculated on Schedule SE (Self-Employment Tax). However, you only pay this tax on profits over $400. The good news is that you can deduct one-half of your self-employment tax from your gross income when calculating your adjusted gross income (AGI) on Form 1040, which helps reduce your overall tax liability.

Closing Tip for Idaho Residents

Tax laws can be complex, and it's easy to miss deductions. I strongly recommend keeping excellent records throughout the year – mileage logs, receipts for all expenses, and income statements from Lyft. Consider using accounting software designed for gig workers to simplify tracking. For the most up-to-date information and specific guidance tailored to your situation, please consult the Idaho State Tax Commission website (https://tax.idaho.gov/) or seek professional tax advice from a qualified CPA or tax preparer in Idaho. Wishing you a safe and profitable driving year!