Turo Host Taxes in Texas - 2025 Guide

Updated for 2025 (Filing 2024 Taxes)

Is Turo Host income taxable in Texas?

Yes, your income earned as a Turo host is taxable at the federal level. The IRS considers Turo hosting a business activity, meaning you’ll report your earnings and expenses on Schedule C (Profit or Loss From Business) when you file your federal income tax return (Form 1040). You'll calculate your net profit (income minus expenses) on Schedule C, and that net profit is then added to your other income when calculating your adjusted gross income (AGI) on Form 1040.

Fortunately, Texas residents enjoy the benefit of no state income tax. This means you will not owe income tax to the state of Texas on your Turo earnings. However, you are still responsible for fulfilling your federal tax obligations.

Top Tax Write-offs for Turo Hosts

As a Turo host, you can significantly reduce your tax liability by claiming eligible business expenses. Here are some key deductions:

• Mileage: For 2024, the standard mileage rate is approximately 67 cents per mile for business use. Keep a detailed log of all miles driven for Turo-related activities (picking up/dropping off vehicles, maintenance, cleaning, etc.). You can choose to use the standard mileage rate or deduct your actual car expenses (gas, oil, repairs, insurance, registration, depreciation – see a tax professional for depreciation rules). You generally can't use both methods.
• Cleaning & Maintenance: Expenses related to cleaning, detailing, and maintaining your vehicle specifically for Turo rentals are deductible. This includes supplies, professional detailing services, and routine maintenance like oil changes and tire rotations.
• Turo Fees & Software: The fees you pay to Turo (commission, etc.) are deductible business expenses. Also, any subscription costs for software or apps used to manage your Turo business (scheduling, accounting, etc.) are deductible.
• Insurance: The portion of your car insurance premium directly attributable to the period your vehicle was available for rent on Turo is deductible. This can be tricky to calculate, so keep good records. Consider consulting a tax professional.

The 15.3% Self-Employment Tax Surprise

Because you're considered self-employed as a Turo host, you're responsible for paying both the employer and employee portions of Social Security and Medicare taxes. This is known as self-employment tax. You'll calculate this on Schedule SE (Self-Employment Tax). The combined rate is 15.3% (12.4% for Social Security up to the annual wage base, and 2.9% for Medicare). You only pay self-employment tax on profits over $400. The good news is that you can deduct one-half of your self-employment tax from your gross income on Form 1040, which helps reduce your overall tax burden.

Closing Tip for Texas Residents

While you benefit from the lack of state income tax in Texas, diligent record-keeping is crucial for maximizing your federal deductions as a Turo host. Keep detailed logs of mileage, expenses, and rental income. Consider using accounting software designed for self-employed individuals. Tax laws can be complex, so don’t hesitate to consult with a qualified tax professional to ensure you’re complying with all regulations and taking advantage of all available tax benefits.