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.
Kevan says
I am updating my Uber account from sole proprietor to individual LLC as sole proprietor and updated my LLC name. It is not letting me update my EIN# in place of my SSN. The SSN field is ghosted and doesn’t allow input. How do I make sure Uber is using my EIN number for tax purposes?
Doug H says
In the driver app, try going to Account > Tax Info > Tax Settings. That’s where you can change your federal tax classification
777 says
Hello i have my Ein number but when I want to use it to open doordash account it’s not passing from background check. Is there any solution for that how i can use to open dasher account with ein number
Doug H says
You have to apply with an SSN. Then after you are accepted, use your EIN to fill out the tax information.
Drew says
Doug,
Where did you see that Uber allows Trust/Estate as a selectable business type. I have been looking for this option on the website under tax classifications on the sign up and cannot find this designation. Just wondering if you could point me to how you found this information. Thank you very much.
Doug H says
In the Uber driver app, I found the trust/estate option by going to: Menu > account > Tax info > Tax settings. Look in the “federal tax classification” dropdown menu for trust/estate near the bottom of the list. The desktop options might be different from the mobile app options, so make sure to look in the app.
Gayatri Aryan says
Hello Doug,
Thank you for sharing your thoughts, very helpful. Is it possible for you to share an example 1099-K, from Uber or Lyft, that pays out to an LLC?
Thanks,
-Gayatri
Doug H says
I did not meet the threshold for the 1099-K this year, but I got the 1099-NEC. My EIN was correctly listed in the “Recipient’s TIN” section. Was your 1099-K paid out incorrectly?
Lessie says
Hi Doug! Thanks for all of this information!
Do you happen to know if the LLC of which the EIN you submit has to be under your own name?
Doug H says
As far as I know, it does not need to be under your own name. Let me know if you run into trouble using one that doesn’t!
Ernesto says
Hola Doug,
Cómo creo una cuenta con mi empresa LLC Sole MBR, si no tengo SSN?
Gayatri Aryan says
Hello Lessie,
Were you able to figure this out?
Thanks in advance for your inputs.
-G
QmyRIDE says
Hi Doug,
While doing my taxes as sole proprietor driving for Uber, Lyft and QmyRIDE, I realized that Medical Insurance cannot be deducted as Self-Employment Expense on Schedule C, which would have lowered the self-employment tax by bunch. Instead it is deducted after as adjusted gross income, which does not effect the self-employment tax.
If I convert my business from sole proprietor to S-Corp, could I use Medical Insurance as part of S-Corp expenses, thus lowering the self-employment tax?
Doug H says
With an S-Corp, the entity could reimburse you for insurance premium payments and that would be a deductible business expense that lowers your tax obligation. But keep in mind that incorporating might add new taxes depending on your state. And always double check with a CPA or a more tax-focused resource!
Shawna says
Hello Doug,
I created my LLC – S Corp within the first couple of days of this new year. I submitted and followed your directions listed above to update the payout information I have on my Lyft account. I do have all of the correct documentation from my state and the IRS. After submitting my information on the Lyft payout section I received a notification at the top of the page stating that my tax information could not be verified. I reached out to lyft and supplied them with all the documentation they required for their third party processor. After going back and forth with them over email – they said my name must match what the IRS has on file, along with my EIN. Of course, I have checked this and re-entered & submitted this information correctly on the payout screen. Lyft support said they recommend I contact a tax representative.
Would you know what the waiting period time is between starting a new business and lyft being able to verify with the IRS is? I have opened business checking accounts and have had no issues with verification.
Thank you for your time and help!
Doug H says
I’m not sure what the waiting period might be. Try using your state’s business lookup tool to search for the entity. If you can find it there, then Lyft can too. If that’s not the issue, I’m not sure what the problem is and you might have to continue to ask Lyft for more help.