How much should I really be paying in taxes as a Lyft driver

I used TurboTax to estimate my taxes, and I feel like something isn’t adding up. I earned $36,000 from my W2 job and about $15,500 from driving Lyft. I didn’t pay any taxes on the Lyft income. My W2 taxes are pretty much even—I’d owe $7 if it weren’t for the Lyft gig.

TurboTax says I owe over $4,000 combined for federal and state taxes. Does that sound right?

I haven’t gotten a tax summary or 1099 from Lyft yet since I made less than $20,000. I just added the $15,500 as “other self-employed income.” Not sure if that’s affecting things. I plan to see a tax professional, but I’d love to hear your thoughts first.

If the $15,500 from Lyft is your profit, the self-employment tax alone would be about $2,190. You’d also owe income tax on top of that. When you started driving, did you look into how taxes for self-employment work?

@Lennon
No, I didn’t really research it at all :pensive:

Casey said:
@Lennon
No, I didn’t really research it at all :pensive:

Make sure to bring everything, including your detailed mileage log, to your tax professional. That will make a big difference.

@Lennon
They probably don’t even have a mileage log.

Reeve said:
@Lennon
They probably don’t even have a mileage log.

They mentioned a log in their post, though.

Casey said:
@Lennon
No, I didn’t really research it at all :pensive:

As a self-employed worker, you’re responsible for both halves of Social Security and Medicare taxes. When you have a W2 job, your employer pays half, but as self-employed, you cover it all. This can really add up.

@Thorn
That applies specifically to FICA taxes, as mentioned in the link.

Renny said:
@Thorn
That applies specifically to FICA taxes, as mentioned in the link.

FICA includes Social Security and Medicare.

Piper said:

Renny said:
@Thorn
That applies specifically to FICA taxes, as mentioned in the link.

FICA includes Social Security and Medicare.

Correct. FICA is just a combination of Social Security and Medicare taxes.

Casey said:
@Lennon
No, I didn’t really research it at all :pensive:

Did Lyft provide any information about taxes when you signed up to drive for them?

@Jo
It would still be helpful if they gave a general heads-up, like suggesting drivers research potential tax obligations.

If you made $15,500 in profit from Lyft, then yes, that tax amount sounds about right. Did you deduct mileage and other expenses?

Make sure to deduct your mileage and the fees Lyft takes out. Your 1099 might show more than $15,500. Wait for the official statement before stressing too much.

It sounds like you forgot to deduct mileage and other work-related costs, like water bottles for passengers.

Perrin said:
It sounds like you forgot to deduct mileage and other work-related costs, like water bottles for passengers.

It looks like TurboTax only applied the standard deduction. I didn’t see where to add my mileage.

@Casey
Your Lyft expenses, including mileage, go on a Schedule C form.

@Casey
Even if you take the standard deduction, you can still claim mileage as a business expense. Just make sure you enter it under self-employment.

@Casey
Check the Lyft app—some apps automatically track mileage for you. That might save you time.

If you’re filing as single and don’t have state income tax, your self-employment tax and income tax could total about $4,185. So yeah, it seems accurate.