Uber Driver Taxes in Indiana - 2025 Guide

Updated for 2025 (Filing 2024 Taxes)

Is Uber Driver income taxable in Indiana?

Yes, income earned as an Uber driver is absolutely taxable, both at the federal and Indiana state levels. The IRS considers you self-employed, not an employee of Uber. This means you're responsible for reporting your earnings and paying all applicable taxes.

Federal Requirements: You'll report your Uber income and expenses on Schedule C (Profit or Loss From Business), which is filed with your Form 1040. This form calculates your net profit (income minus expenses). It's crucial to keep accurate records of both your income from Uber and all related business expenses.

Indiana Specific Rules: Indiana has a flat income tax rate of 3.15% for 2024. Your net profit from Schedule C will be added to your other income, and this total taxable income will be subject to the 3.15% Indiana state income tax. Indiana also requires you to file a state income tax return (Form IT-1040) to report this income.

Top Tax Write-offs for Uber Drivers

As a self-employed Uber driver, you can significantly reduce your tax liability by claiming eligible business deductions. Here are some key write-offs:

• Mileage: This is often the largest deduction. For 2024, the standard mileage rate is 67 cents per mile for business use. You must keep a detailed mileage log documenting the date, purpose (Uber trip), and miles driven. You can not use this rate for commuting to/from your home base.
• Vehicle Expenses (Alternative to Mileage): Instead of the standard mileage rate, you can deduct the actual expenses of operating your vehicle, such as gas, oil changes, repairs, insurance, registration fees, and depreciation. You must choose one method (standard mileage or actual expenses) and be consistent.
• Uber App Fees & Software: Any fees you pay to Uber, as well as the cost of any tax preparation software or apps used specifically for managing your Uber income and expenses, are deductible.
• Phone Expenses: If you use your personal phone for Uber-related activities (navigation, accepting rides, etc.), you can deduct the percentage of your phone bill that corresponds to business use. Keep records of your usage.

The 15.3% Self-Employment Tax Surprise

Because you're self-employed, you're responsible for paying both the employer and employee portions of Social Security and Medicare taxes. This combined tax is called Self-Employment Tax and is currently 15.3% (12.4% for Social Security up to the annual wage base, and 2.9% for Medicare). You'll calculate this on Schedule SE (Self-Employment Tax). However, you only pay self-employment tax on your net earnings over $400. The good news is that you can deduct one-half of your self-employment tax from your gross income on Form 1040.

Closing Tip for Indiana Residents

Don't wait until the last minute to prepare your taxes! Keeping meticulous records throughout the year – income statements from Uber, mileage logs, expense receipts – will make the process much smoother and ensure you claim all the deductions you're entitled to. Consider using accounting software designed for self-employed individuals. If you find yourself overwhelmed, consulting with a qualified tax professional in Indiana is always a wise investment.