Most Uber and Lyft drivers are sole proprietors who will report their ride share earnings on the Schedule C tax form, but some of you may have an LLC, corporation, or other tax entity that you prefer to operate under.
It’s a smart move — by reporting your Uber and Lyft earnings under the umbrella of a corporation, you may be able to lower your tax bill.
Neither Uber nor Lyft makes it totally clear how to have your earnings filed under your Employer ID Number (EIN) or another tax ID.
And after you do figure out how to navigate each Uber & Lyft’s tax reporting system, there’s often not a lot of reassurance that you’ve done it right and everything will be correctly reported at tax time.
I’ve operated as an Uber and Lyft driver under my S-Corp for a few years now, so I’ll walk you through how you can let Uber and Lyft know that you are operating under an EIN or another tax classification.
And I can tell you to expect at tax time each year.
Which tax classifications does Uber accept?
Uber allows you to operate under many different tax classifications. By default, drivers are individuals/sole proprietors, but Uber also allows drivers to operate under the following tax classifications:
- Individual/Sole Proprietor
- C Corporation
- S Corporation
- Limited Liability C Corporation
- Limited Liability S Corporation
- Limited Liability Partnership
- Single member LLC under a business entity
- Single member LLC with individual as sole owner
- Partnership
- Trust/estate
How to set your tax classification with Uber
In the Uber Driver app, tap Menu > Account > Tax Info > Tax Settings.
On the tax settings screen, you can select your federal tax classification, and enter your company legal name, DBA, and EIN.
Change your tax settings in the Uber Driver app
Options on the Uber Tax settings page
How to set your tax classification with Lyft
Lyft allows drivers to select two tax classifications: Individual, or Corporation/LLC.
There are two ways to change your tax classification settings with Lyft.
Lyft Driver App Instructions
Select Menu > Account > Pay and Tax Info > Scroll to Tax Info.
Those steps will direct you to your profile page at Lyft.com, where you can update your info.
Lyft.com Instructions
- Log in at Lyft.com/login
- On the left menu, click “Payout Information”
- Click the edit button
- Enter the relevant info. Classification, EIN, etc
- Click Save
After you have successfully entered your info, the Tax Classification should be the entity that you entered.
Lyft’s system never displays any part of your EIN displayed on screen after you submit it, and if you re-click “Edit Tax Info,” the EIN field is blank.
The blank EIN field may make you feel like Lyft hasn’t correctly received or stored your info, which is not reassuring. But in my experience, Lyft does receive and use the info you input.
Go to Lyft.com/login and click Payout Information
Enter your tax classification and EIN
You can also use an EIN with other top gig companies
You can use your business entity for any 1099 work that you do.
When you are completing your tax info or filling out a W-9, use your EIN or other business entity to be taxed as that entity.
You can use your EIN at top gigs like:
- DoorDash
- Instacart
- Shipt
- Amazon Flex
- …and any other gig app that has you fill out a w-9 or classifies you as a 1099 contractor
What happens at tax time?
One of my fears when I first created my S-Corp was that Uber and Lyft would file a 1099 under my SSN, and I’d either have to spend time correcting that with Uber and Lyft or pay the higher tax rate of a sole proprietor.
Neither company spells it out in huge letters that you’ve correctly listed your EIN, and they don’t specifically say that your income will be reported to your EIN. For a new corporation holder, that might be scary. It was for me.
In my experience, both companies sent me a 1099 in January that listed my EIN and corporation name rather than my SSN.
I’ve learned that companies don’t need to send a 1099 to a corporation, but Uber and Lyft do.
I appreciate getting the 1099s because they reassure me that the income has been properly attributed to my EIN.
So when you file your taxes or have someone else prepare your taxes, you can be assured that the IRS knows that your income is tied to your EIN, not your SSN.
Erik says
Oh I forgot to ask one more question. In CA I have commercial insurance since it’s limo company. Do I need to get any S-corp related insurance in Texas? And what kind of S-corp should I regester if I planning to do lyft/uber? What if my plans changes, let say I want to do e-commerce/amazon, can I still use that S-corp?
DougH says
Great questions, but they’re above my pay grade. A CPA or tax preparer could help, or possibly another reader can chime in.
Erik says
Hi,
I did use my EIN of s corporation back in CA when I was driving Lyft/Uber. Now I moved to Texas. I still have an active S-Corp in California and it’s limo company.
Now I’m confused. Should I open S-corp here in Texas as a branch of my S-corp?
Somebody asked similar question about Wyoming. And people responds confused me.
My understand S-Corp is belong where you do business (State) and you pay a franchise tax to that state every year. In CA it’s $800 minimum. Texas is about the same. Just want to do right way, without overpaying or sneaking. Thank in advance!
Jase says
I always appreciate your work to educate and inform the Rideshare Community. How are you Taxed (and pay Taxes) for Uber/Lyft pay under your S-Corp/LLC? Are you a disregarded entity and file the 1099 Income Tax on your personal return? Or do you technically pay yourself from the LLC? Or? That’s what’s really confusing me. Ideally, I want my 1099 income to be associated with my LLC EIN and not my SSN/Sched C on my personal tax return. Or is that unlawful? lol.
DougH says
I always begin with the advice to consult a CPA or tax preparer because I’m not either of those things! But here’s how it works for me: Uber/Lyft pay the business entity, and the business entity pays me. From a tax preparation standpoint, it’s a bit complicated. It may only be worth it if you have other businesses that would require an LLC or corp. If you’re just a driver, it may be better to just stay as a sole proprietor
Sam says
I have a digital marketing agency based on Wyoming, Do you think I can drive Uber in a different state using the Wyoming LLC??
DougH says
Yes, you should be able to do that
Jase says
From a business perspective, I agree with Doug, you should be able to do that. The problem will be your vehicle registration — If you’re planning on driving in Colorado for example, you must have Colorado Registration and Colorado Minimum Insurance Requirements to drive for either platform in the state. Adding your Wyoming LLC/EIN to your payment/tax section in your Lyft/Uber account will be the easy part!
Christine F Smith says
They are telling me they don’t accept my new vehicle but accepted the insurance . 2021 Ford Edge Titanium. It is registered in my cleaning business name. It is a corporation but insurance just has my personal name.i only got the car with my EIN because I couldn’t get it under my social. Any advice. Ty for your articles.
DougH says
Best move is to call 18005937069. It could be some other issue, unless they specifically told you it was a problem with the vehicle name.
Corp? Yiorkatzi says
Do I need to have workers comp insurance sldo if I use my s corp?
DougH says
You don’t need workers comp insurance as far as I know, but you could contact a CPA from your state for more info about that.
u b says
My EID doesnt have a dash in it. Ubers EID field wants a dash. What is going on here ?
DougH says
Do you mean EIN? I’m not sure what an EID is