All posts by Malik Akande

Carchex Review -Extended Warranty for Uber Drivers

 

Carchex_Warranty_450by342This post is a Carchex Review. For those actively searching for Extended Warranty Programs for their Uber Vehicle(s), there is a new program by Carchex for Uber drivers called the “Protect My Uber” plan.  Just so you know, Carchex has been in business since 1999 and has exclusive agreements with companies like Edmunds and Carfax.com. So, from all indications Carchex is a reputable business. They also have an A+ rating by the better business bureau (see here).

I spoke with Joe Campanella (the EVP of Business Development) about Carchex, and got some interesting information.  I was also able to dig up some information about Carchex that can prove helpful in reviewing the business.

For those who don’t understand the difference between Insurance and Car Warranties – One statement that stuck out to me when I spoke with Joe was this Insurance covers accident repair costs, but extended warranties cover unexpected auto repairs”.  Read more below to see what I was able to find out about the Carchex plan for Uber drivers –

 

Availability of the “Protect My Uber” Plan

The “Protect My Uber” plan is currently available in 34 states in the U.S (AK, AK, CO, DE, D.C., FL, HI, ID, IN, KS, KY, ME, MA, MI, MN, MO, MT, NH, NJ, NM, NY, NC, ND, OH, PA, RI, SC, SD, TN, TX, VT, VA, WV, WY), but should be available nationwide soon. They currently have no plans to rollout internationally, but that might change.  Their plan is also only available to Uber Partners with cars no older than 15 years and with less than 150,000 miles.

 

Benefits of the “Protect My Uber” Plan

  1. Compared to Standard Extended Warranty Plans – Standard Vehicle Protection Plans have an exclusion for livery, taxi and shuttle services which voids the Vehicle Protection Plan. This is not the case with the Carchex “Protect My Uber” Plan
  1. Tax Deductions – Expenses put towards your monthly extended warranty costs can be taken as tax deductions. (For more on Uber and Taxes, see our post here).
  1.  Unexpected Car Repair Costs – The plan created by Carchex for Uber drivers protects drivers from unexpected repairs and mechanical breakdowns, which insurance doesn’t cover. Insurance covers accident repair costs, but extended warranties cover repairs which are sometimes routine for a car/vehicle. As an uber driver or Uber business owner, predicting your costs is the smart thing to do if you want to be profitable.
  1. Pre-Paid Maintenance – The Carchex Pre-Paid maintenance program allows an Uber driver to receive the following maintenance services every 6,000 miles during the term of their Vehicle Protection Plan – Oil change and filter; tire rotation; lubricate front suspension, steering linkage and ball joints; multipoint inspection including hoses, belts, tires, etc.  Note, the Tire and wheel protection costs $15 a month, and the Pre-paid maintenance (Oil & Filter etc.) cost $9 a month.
  1.  Free Trial –Per Joe Campanella (their EVP of Business Development)-“If for any reason you need to cancel before 30 days, you get a full refund”.
  1. Month-To-Month –Payment for the plan is month to month with 0% financing options available through Carchex.
  1. Cancelling your Plan – Carchex offers plan cancellations, and pro-rated refunds. By pro-rated refunds, it means if for example you decide to cancel after 3 months, of a 12 month program, you get the equivalent of 9 months back refunded to you.
  1. Signup Process Go here to signup.  Note -You only need your car’s VIN, exact miles and your street address to activate your protection plan with Carchex.
  1. Claims ProcessIf you need to file a claim, follow the steps below
    • Step 1 – Take the vehicle to any licensed repair facility
    • Step 2 – Have your car diagnosed and repair the vehicle
    • Step 3 – Carchex will then pay for the parts, labor, taxes and the diagnostics directly to the repair facility.

 

Cost of the “Protect My Uber” Plan

The “Protect My Uber” currently costs between $100 to $150 per month, depending on the add-ons to the plan a driver selects.

 

Cons of the Program

Some of the things I don’t particularly like about the program are the following –

      • Deductibles – You have to pay a deductible when you take your car in. (Granted, the deductibles range from $100 to $500 – depending on your plan). I don’t like deductibles. Per Joe, “the average deductible is around $100”.
      • Maintenance Items not Included – Some maintenance items are not included in this plan – for example windshield wipers.

 

Opinion
Our Carchex Review: for a brand new car, you probably don’t need an extended vehicle protection plan, (most cars generally don’t start having issues until they have about 60,000 miles or greater on them). For cars that have between 60,000 miles to 150,000 miles on them, getting the “protect my uber plan” might not be a bad idea (if your numbers make sense –download our financial calculator to determine if your numbers make sense).

Ultimately, making money is about increasing revenue (getting as many drivers and/or rides per car as possible within a set time) and managing or predicting your costs effectively. Your car maintenance/repair cost is a big part of your costs as an uber partner (driver and/or owner), and effectively managing this cost is important if you plan to make any real profit with your Uber Business.

The way i see it, if you have  older vehicle(s)  (60,000 miles or more), register for the “Protect Your Uber Plan” and if before 30 days you see it doesn’t make sense you cancel and lose nothing.

 

To Signup
To Sign up for the Carchex “protect my uber plan” go here.

 

 

 

Other Interesting Uber Related Posts
For our blog posts on some of Uber’s Services, see the links below:

 

For other popular posts you might be interested
in, check the links below:

 

 

Uber Rider Behavior [A Data Analysis]

A Data Analysis of Uber Rider Behavior

 

 

Uber DataWith great use comes great data, I say! This article was largely written by William Jade of UberEstimate.org.  As an Uber passenger and partner, I often wonder what other people are doing on the Uber platform, and if I am just an anomaly. Well, William was willing to share some of his wonderful and interesting data with us. Note- the article is a synopsis of sampled data from both the UberMeter app and UberEstimate.org site. Anonymized data from 17,000 unique users was collected over a period of roughly 3 months. Please read and enjoy some of William’s findings below!

 

Uber User Statistics

UberEstimate.org has been able to provide better insight into the behavior of American Uber riders, through monitoring various queries made by the thousands of users on their application. These statistics provide more details about how people use Uber, where Uber is more popular and the different popular routes that are taken with Uber trips.

Per their data, Uber received an 890% maximum surge within the past three months. Their UberXL service has seen the highest surge rate, followed closely by the UberX service. It was also reported that the average cost of an Uber trip is $19.60, with the average distance travelled per Uber trip being 20.26 miles.

 

Common Uber Destinations

The collected data also provides evidence of the most popular destinations Uber trips drive to, with Los Angeles International Airport and New York City being among the top destinations for Uber riders. San Francisco International Airport, LaGuardia Airport and Newark Liberty International Airport is also among the top five destinations. Other popular destinations include:

  • O’Hare International Airport
  • Dallas / Fort Worth International Airport
  • Orlando International Airport
  • One Prudential Plaza in Chicago
  • Miami Beach in Florida

 

Common Uber Routes

Data has also provided significant insight into the most popular routes Uber is used for. These routes are used to get from point A to point B by millions of active Uber users. The most popular recorded route is from LaGuardia to Manhattan, with a route from Fort Lauderdale to Miami and from Las Vegas to McCarran Airport closely being the second and third most popular routes. Many other popular routes have also been recorded to include:

  • LAX to Disneyland
  • Newark to Manhattan
  • SFO to Palo Alto
  • LAX to UCLA
  • SeaTac Airport to Seattle

 

Conclusion (For General Uber Enthusiasts)
Through the analysis of the data collected and provided by Uber Estimate, it becomes clear that the company is very popular in the United States. The international expansions by Uber have created many opportunities in other countries such as the United Kingdom and even countries such as Asia and India. With time, Uber will continue to grow and will continue to expand into new regions, thus assisting with the economy and unemployment rate in many countries.

 

Conclusion (For Uber Partners)

Per the data received from William, what I can say is if you are an Uber partner looking to make good money, it might not be a bad idea to invest in an UberXL vehicle. Getting your airport permit might also not be a bad idea (if you need one in your city for airport pickups). The proof is in the data pudding!

 

About UberEstimate.org

UberEstimate.org is a service that allows for estimating the cost of an Uber ride. For more information about UberEstimate.org and to use their service, go to their site here .

Also, to receive professionally vetted information that will assist you in running a profitable Uber business download our Uber kit at the top right of this page.

 

Other Interesting Uber Related Links:

For our blog posts on some of Uber’s Services, see the links below:

For other popular posts you might be interested in, check the links below:

 

How to Get Free Uber Rides

How to Get Free Uber Rides:  An in-depth discussion with steps, and widgets

 

 

Do you want to get a stream of free Uber rides? This blog post walks through the procedure on how to get free rides from Uber.

To get free rides from Uber, what you need to do is simple: Share your Uber referral link with friends and strangers alike. When you get a signup through that custom link, you automatically get credited with a free ride in your account, up to $15 (for US Uber customers). To Share your Uber referral link, you need to know “how to generate the referral link” and “how to put your link promotion efforts on autopilot”. We discuss the two below.


How to Generate your Uber Referral Link:

To generate your Uber referral link follow the steps below-

  1. Log in to your Uber rider account herehttps://login.uber.com/login
  2. Click “Free Rides at the left corner of your screen” :

Uber Free Rides step 1

  1. Click “Get your invite Link” below the Send Your Promo Code

Uber Free Rides step 2

  1. Now, just copy your invite link

Uber Free Rides step 3

  1. Email your invite links to your friends and post your invite link on Facebook, Twitter and other personal social media accounts.

 

Note – Uber does not take kindly to using Search Engine Marketing (i.e Google Adwords, or Bing advertising) for promoting your referral link. In the next section we discuss how to put your link promotion strategy in autopilot.

 

 




How To Put Your Uber Link Promotion on Autopilot

To auto-pilot your link promotion, you can embed an easy to use Uber Badge Widget in your website, blog or forum posts and profile.

By posting a small snippet of modifiable code on your forum profile (for instance) or your own blog (if you have one already) you automatically exponentially increase the exposure of your referral link”

Every time your website or unique profile is linked to, or quoted, you dramatically increase the odds of getting a free ride because people love to click images!

Now you might ask, where do I get this “Uber Badge Widget”? Fortunately for you, we have created one which we are proud of below to help with your “Uber Free Ride” promotion efforts. See the next section below.

 

 


Free Ride Referral Uber Badge

In just 2 steps, you can have a badge like the one you see above displayed in a blog, forum, or website! The steps you need to follow are listed below:

 

1)   Just copy the snippet of code below into any forum profile, blog or website you have access to or own and you are almost done

2)   Replace the text “YAM” with your unique Uber referral code. In our case, ours is “m3okv”

And you are done! See our sample modification below

Uber Free Rides Widget Snippet

 

Let us know what you think, and if you have any questions.

 

 

 

 

Other Interesting Uber Related Posts

For our blog posts on some of Uber’s Services, see the links below:

For other popular posts you might be interested in, check the links below:

 

My Life as an Uber Driver Series: Leslie’s Diary

 

 

Uber Driver Leslie

We (here at Uberkit.net) understand that the everyday experience of an independent Uber partner journeying through the topsy-turvy word of ridesharing is an interesting one (sometimes). We understand that the to and fro travel everyday takes an Uber driver through various places and people – locking them in with another complete stranger (sometimes pleasant, sometimes awkward) for a significant amount of time, in their own small world (their car). This is why we have launched our series tagged: ‘My Life as an Uber Driver’. How does it work? Simple! We find interested drivers with interesting stories and use their tales in crafting something that interests you. We beg you to join us in this adventurous exploration; we pledge not to bore you for even one second, Enjoy!

 

[Today, we bring you a story crafted from the experiences of Leslie Lowdermilk. A former Uber driver from Austin Texas. She has left the business now to do other things that she considers fun, but she finds it important to tell us how it was and what it felt like while she drove for Uber. Enjoy!]

 

Here I was in my car, lamenting about the silence that had become the definition of my day. That day had not been the best of days. It was the kind where you sit and hope that the day would just repent and be born again. It isn’t always this way though; the great days came more often. On days like that when I got pissed and felt like it was all a mistake to have taken up the Uber driver’s job, I suppressed the thought by remembering why I joined. I remember how I got so deep in love with the idea of setting my work hours in any way that fits me, making so much money part time, and then my frustrations just flew away. Like I always did, I parked and was waiting to receive a ride request – a real good one. I was staring into the beautiful sky that covered Austin, Texas. Then my phone beeped, there was a ride for me. I was so happy and though it might change the day’s story but alas, it was a very short ride. For a minute I felt like going rogue on them like many riders would do and just decline the ride but my good heart did not let me. I got on the way, picked up this cute couple from downtown Austin and took them back to their hotel. We had a brief conversation.

 

I ended up dropping the ‘cute couple’ at a very nice hotel. You must already be guessing how I must have grumbled in my heart all through the trip since it was a short ride with a very low fare – probably around $5.50, but I kept my smile and stayed as warm as ever.  It was a pleasant ride but really nothing spectacular…or so I thought. The gentleman asked me if I could wait for just a moment – I said sure (believe the word ‘gentleman’ please). The couple spoke for just a moment before the woman walked into the hotel and the gentleman walked off behind the car. When he came back to the car about a minute later, I rolled down the window for him. He leaned in and put his hand out to me. He said, “Next time you want to take the night off, it’s on me.” And then he handed me a $100 tip. I was speechless.

 

I thought of saying ‘”thank you” but it seemed too small a way to show my appreciation for such a generous deed… and yes, I thought of saying it in UPPERCASE too. With tears in my eyes I looked at him and he got the solemn but strong message. He had no idea how his random act of kindness restored some of my faith in the goodness of humanity that night. Most passengers never tipped and when they did, it was not more than a couple of bucks. But for someone to have tipped $100 seemed too good to be true – I know you wish you had a story like mine. And so my day repented as hoped. My mood soon brightened and I concluded in my heart that Uber wasn’t a bad deal after all, it gave the opportunity to live your environment daily – learning and travelling a route you never knew existed and getting to meet beautiful souls like I just did. The money made me happy, sure. But the heart from which it must have come blessed me more than the money did. It made me remember the very best experience I had when a passenger turned friend. I picked her up from work one evening and drove her back to her hotel. She was in town for business for the week and I told her that if she wanted, I would be her personal Uber driver for the entire week, all she had to do was let me know when I needed to be where to pick her up and when she called for an Uber cab while sitting in my car, I’d be the closest one and would automatically get the ride. She liked the idea and for a week, I took her to and from work. One evening, I even took her shopping at Wal-Mart and she insisted that I leave the meter running. On her final night in Austin, she took me out to dinner.

 

I’m telling this story now from the future and I wouldn’t tag it a bad experience. Although I had to move on to something else for the sake of more fun, I remember those moments with a smile on my face. As I live the life I’d call perfect, doing the things that make me happy (like traveling to non-touristy places), being at peace with myself (no drama), enjoying the love of friends and family, cuddling with my kitties while reading a good book, my piece of advice to Uber is to raise the rates so that the drivers get paid more. Patrons are willing to pay more. I’ve heard them say so. They CHOOSE to pay more because they don’t WANT a “cabbie” experience.

 

At this rate, Uber is losing good drivers and getting people who are willing to work for pennies on the dollar, what they are getting is the bottom of the barrel – those people who act just like cabbies. I just heard the other day about a person who took an Uber cab and told me it was the most disgusting car she’d ever ridden in. You get what you pay for. YOU HAVE NO OVERHEAD – and you get what you pay for. Pay your “contractors” a decent wage and you will get people willing to work hard and give good customer service. It’s not rocket science.

 

And to every driver out there I’d just say keep your head up. I feel this is a trick by Uber to just get more sign-ups to boast about in a few months, I do not think it’s a permanent arrangement. Give the best customer service you can and something more – something the person will remember. If a tourist or visitor; give them a ‘secret treasure’ attraction (I always told people about the Museum of the Weird on 6th St. in Austin. But also respect those who just wanted to have quiet. Be polite, funny and pleasant. Be open and real.”

 

If ever you face anything that seems too much for you to bear, do what I did when I got laid off from my dream job – keep breathing. That way, better things will come around and more of your dreams will come to pass. I am Leslie, and this is my Uber Story.

 

The major storyline for this post was provided by:  Leslie Lowdermilk (from true life experiences)

 

Uber Driver Leslie

LinkedIn profile: http://www.linkedin.com/in/leslielowdermilk

Personal Blog:  www.leslielowdermilk.com

Twitter: @lowdermilkl

Business page: www.solcatchers.net.

Compiled and Edited by: Ola John

 

If you are interested in having your story told, send us an email at inquiries@uberkit.net

 

Become an Uber Driver

Other Interesting Uber Driver Related Posts

For our blog posts on some of Uber’s Services, see the links below:

For other popular posts you might be interested in, check the links below:

Uber Tax Series: All About Your Uber Taxes

 

 

Become an Uber Driver

For Uber drivers in the US, we know what tax time means. Tax time means you fall into one of two buckets:  (1) Getting a refund check or (2) paying the U.S government money owed. The way you file your taxes, how you have managed your expenses and your income for the preceding year largely govern which bucket you fall into.

In our attempt to write an article that is thorough and backed with knowledge from tax industry experts, we did two things: (1) provided links to existing websites with very relevant Uber Tax information, and (2) we interviewed 3 tax experts (Andrew PoulosMicah Fraim, and Anil Melwani) with over 40 years of experience. Please continue reading to learn more about your Uber Taxes:

 

You Are the Boss:

When you are an Uber driver, you are the boss (an independent contractor of Uber). An Uber driver is not an Uber employee, and as such has to pay his/her own taxes.  As mentioned in this article, “Uber classifies its drivers as independent contractors [or self employed individuals]”.  This is why you receive a 1099K and/or 1099 Misc and not a W2 when you work with Uber.

Andrew Poulos says, “A self-employed person is required to pay federal and state income taxes, which they would pay even if they were an employee. The difference in being self-employed is the person is responsible for paying 15.3% FICA taxes, which is 7.65% for the employee portion, and 7.65% for the employer portion”.

FICA Taxes “… are the Social Security and Medicare taxes sole proprietors pay. When you’re an independent contractor, you have to pay all your Social Security and Medicare taxes out of your own pocket … a flat 15.3 percent tax on your first $118,500 in net self-employment income (in 2015). ” – See more information here

 

Become an Uber Driver

Tax Deductions – Standard or Itemized?

The way you take tax deductions can impact how much you receive from the Government as a refund, or how much the IRS determines you owe the Government.  You can either track your car mileage, or take actual deductions of expenses directly attributable to your Uber business. Before deciding what expense method to follow, realize that you cannot reverse it in any subsequent years- as Anil Melwani puts it, “once one of the methods is chosen you must stick to that method for the life of the vehicle”.

Also realize that there is no clear cut way to select which expense method to follow for your taxes:  Andrew Poulos says, “[The choice of] standard mileage or actual expenses is best determined on a case by case basis [by your accountant]”

 

What Are the Deductions?

If your expense method is the itemized method, here is a list of some of the deductions you should consider:

 

Some deductions:

  • Automobile,

“When you are dealing with tax deductible business expenses, you need to keep very detailed records. The biggest business expense is usually your car, so make sure you have detailed mileage logs for every day you drive. You can usually fill in your mileage logs say for the past week or two, but don’t try to estimate your mileage logs at the end of the year. It needs to be recorded as they happened and not hastily filled in during tax season” – (see here).

  • Automobile depreciation
  • Car payment, Lease (deduct only portion used for ridesharing)
  • Interest on Auto Loan only (deduct only portion used for ridesharing)
  • Insurance
  • Repairs
  • Tires
  • Maintenance
  • Gas and oil

Other deductions:

  • Roadside assistance charge
  • Car washes and interior cleaning
  • Water, gum, or snacks for passengers
  • Tolls and parking fees
  • The fraction of your mobile phone expenses attributable to your rideshare/uber driver work can be used to reduce your self-employment income.

 

Documentation You Should Keep to Support Your Itemized Deductions:

If your chosen expense method is itemized deductions, then this section is for you. As Andrew Poulos says, Uber drivers need to keep “accurate records of their expenses because if they ever get audited the IRS will disallow any expenses claimed on the tax return that [can’t] be substantiated with supporting documentation”.

The IRS could disallow any tax deductions you can’t support with (See link for more information):

  • Receipts
  • Mileage logs
  • Any other documentation

 

About Your 1099k:

“Payments for processing your customers’ [fares] are reported on Form 1099-K. The amount shown in Box 1a of this form is all the money [including Uber’s commission] that the ride-share operator collected from customers for rides that you provided.” – TurboTax.

 

Note, if you don’t receive your 1099k from Uber, Micah Fraim advises that you “contact Uber directly to ensure one has been issued”. Micah Fraim also warns that “failure to report the income can cause serious headaches down the road [in the form of potential IRS audits]”.

 

About Your 1099 Misc:

If you didn’t get any driver or passenger referrals, this section is probably not for you. Any income outside the income made from transporting customers is likely going to be reported on this form. More specifically Micah Fraim mentions that “If the driver makes over $600 [in Uber referral commissions] in the year, Uber is required to issue the Uber driver a 1099-MISC form and also file that with the IRS”: So in essence you might not receive a 1099-MISC if your miscellaneous (referral) income is less than $600.

Note – in respect to both your 1099-K and 1099-MISC, whether or not you receive one from Uber you are expected to report the income and pay taxes on it. As Anil Melwani says, “It is ILLEGAL not to declare ALL income.  Most WORLDWIDE income is reportable (and sometimes taxable) for U.S. citizens and green card holders.”

Editor’s Note:  If you don’t receive your tax forms (1099-K and/or 1099-MISC) from Uber, send them an email.

 

Preparing for Next Year’s Taxes:

  1. Tools to use for tracking your expenses:

Per our tax experts, consider using any combination of these tools – Quickbooks, Freshbooks, Mint.com, Zoho books, Expensify, MileIQ.com, Xero and for very simple bookkeeping a spreadsheet can also work.

 

  1. What to do to prepare for next year’s taxes:

Per Andrew Poulos, “A person operating as an Uber driver should keep good records for their income and expenses, and they should pay in quarterly estimated tax payments to avoid having a tax liability when they file their tax return. Since having self-employment income adds complexity to an individual’s tax return, it’s recommended that an Uber driver consult with a licensed and qualified tax professional to make sure they are estimating properly for quarterly tax payments, and taking advantage of all deductions they are allowed to claim”.

Thanks for reading. We hope this was a very informative article. For links to transcripts from the individual Q&A sessions we had with the tax experts, answers to questions not covered in the article above, and how to contact the tax experts, see the links below:

Q&A with Andrew Poulos

Q&A with Micah Fraim

Q&A with Anil Melwani

 

To receive professionally vetted information that will assist you in running a profitable Uber business whilst staying insured download our Uber kit at the top right of this page.

 

Other Interesting Uber Related Posts

For our blog posts on some of Uber’s Services, see the links below:

For other popular posts you might be interested in, check the links below:

Uber Tax Series:  Perspectives from an Industry Expert – Andrew Poulos

 

 

Andrew Poulos, Uber TaxesSince the tax season is fast approaching for the Uber drivers in the United States, we decided to do a Question and Answer session (Q & A session) with Andrew Poulos, a tax expert with over 21 years of experience.

 

Andrew is very knowledgeable and provides insights for Uber drivers and Entrepreneurs that will help them save money this tax season. Andrew also provides tips that will help you plan your  tax strategy this year, so that in the coming year you have a bigger tax refund.  Read the full Q & A below to find out his expert opinion and general thoughts as it relates to your Uber taxes.

 

a) What is your name?

Andrew Poulos

 

b) Where do you work, and what is your position/title?

Poulos Accounting & Consulting, Inc., Atlanta, GA.  My title is principal of the firm.

 

c) What does your job entail?

I work with individuals and businesses across the country and internationally, providing accounting, tax preparation, tax representation services, and representation for collections, and audits at both the IRS and state labor level.

 

d) How long have you been in the Accounting/Tax field?

21   years

 

e) What is your general opinion on the Uber business?

I think it’s a great business model, but of course there are concerns about the treatment of the drivers as independent contractors.

 

f)  Where do you stand on the widespread notion that Uber is disrupting long held industry regulations? (Specifically relating to W2 vs. independent contractor classification of workers)

Being that I represent employers for worker classification audits at the IRS and state level, I foresee the W-2 vs. Independent Contractor worker classification turning into a federal case which will ultimately go to U.S. Tax Court, and will set precedent for the industry.

 

g) What would happen to Uber drivers in the US, if they become classified as W2 employees?

If drivers become classified as W-2 employees, they will be impacted several ways. They will have federal, state, and FICA taxes withheld from their paychecks, they will be entitled to any benefits that other Uber employees are offered, and they won’t have to pay for their own gas. Most significantly, Uber drivers will not file a Schedule C on their personal tax return, and will not be able to deduct other business expenses they may have for operating their independent Uber business.

 

h)What are the major differences in taxation between someone driving for Uber full time and someone driving part time?

Driving full-time or part-time doesn’t necessarily determine if someone should be classified as an independent contractor or W-2 employee. If drivers are classified as W-2 employees, they will all be employees regardless if someone drives full-time or part-time.  The one major difference is, depending on what Uber sets in their company policies and employee manual, part-time drivers may not be entitled to benefits or the same benefits as full-time drivers.

 

i) Do I have to file quarterly tax reports, as a self-employed person in a part-time Uber driver role?

Operating as a sole proprietor you don’t file quarterly tax returns like you do if you operate as a corporation or LLC and have W-2 employees. However, a self-employed person in a part-time Uber driver role will receive a 1099 just like a full-time driver, and may have a tax liability from the self-employment income earned. Therefore, it is recommended that all Uber drivers [part time or full time] that are independent contractors pay quarterly estimated tax payments to avoid having a tax liability when they file their tax return. Having a tax liability also subjects a person to incurring penalties and interest on the balance due.

Note- Paying quarterly estimated taxes is different than filing quarterly tax reports, which are usually filed by a business that has W-2 employees.

 

j) What taxes are paid by an employer that a self-employed person would need to pay themselves?

A self-employed person is required to pay federal and state income taxes, which they would pay even if they were an employee. The difference in being self-employed is the person is responsible for paying 15.3% FICA taxes, which is 7.65% for the employee portion, and 7.65% for the employer portion. By being self-employed they are paying the additional 7.65% that the employer would pay if they were an employee instead of an independent contractor.

 

k)  What are the various types of tax considerations that impact an Uber partner and/or driver?

An Uber driver is considered self-employed thus the person has to file a Schedule C on their tax return. This makes it a bit more complex because they have to claim their Uber income, and any deductions they have on Schedule C, and the net income is taxed for 15.3% FICA, federal, and state taxes. By being self-employed it adds more complexity to a tax return that perhaps a person wouldn’t have if they weren’t an Uber driver or partner.

 

l)Would you advise an Uber driver/Partner to form an LLC in order to operate his/her Uber business?

It may be advantageous to form an LLC for tax purposes. This depends on several factors, one of which is how much income does the Uber driver/partner expect to earn during the year. A single member LLC defaults to a sole proprietorship for tax purposes, therefore the individual won’t have any tax advantage unless they convert the LLC to an S Corporation for tax purposes. In determining if an Uber driver should form an LLC and convert the entity to an S Corporation, they should consider the added record keeping and cost for quarterly tax filings, and year-end corporate tax return preparation, in addition to other factors that should be considered.

 

m)  What does an Uber driver need to do from the start of the business to ensure that they never have issues when filing their taxes?

A person operating as an Uber driver should keep good records for their income and expenses, and they should pay in quarterly estimated tax payments to avoid having a tax liability when they file their tax return. Since having self-employment income adds complexity to an individual’s tax return, it’s recommended that an Uber driver consult with a licensed and qualified tax professional to make sure they are estimating properly for quarterly tax payments, and taking advantage of all deductions they are allowed to claim.

 

n)What professional advice would you give an entrepreneur hoping to operate a fleet of cars as regards taxes?

I highly recommend an entrepreneur consult with a qualified and licensed tax professional or accountant prior to getting started so they can form the correct entity that will be the most tax advantageous to them.

 

o)  Standard Mileage or Track Expenses? What is the better option for an Uber driver/Uber partner?

Standard mileage or actual expenses is best determined on a case by case basis: the percentage of business use of the vehicle used for Uber,  the cost of the vehicle, maintenance and gas, would be factors to consider if actual expenses or standard deduction should be claimed.  The important factor to know is that whichever method an Uber driver elects to use in the first year of filing their tax return, they must use the same method each year thereafter for as long as that vehicle is in business use.

 

p)  What are the top deductions that an Uber driver needs to track?

Some of the top deductions that an Uber driver should keep track of is business miles driven, fuel cost, maintenance cost, auto insurance, cell phone, navigation fees if they have a GPS for business use, health insurance that may be deductible on Schedule C since Uber drivers are self-employed, tax preparation and consulting fees, and office supplies.

 

q) What tools do you recommend for an Uber driver to use to track their various expenses?

There are several good tools depending on how sophisticated an Uber driver wants to be. They can use an app called Expensify, Mileiq.com, QuickBooks, or Xero depending on their preference.

 

r) What is the best way for an Uber driver to estimate taxes for the current year, so they don’t have a cash flow situation come tax time?

The best way to estimate and pay quarterly taxes is to take the projected net income (Uber income less expenses) and factor 15.3% for FICA, federal taxes (at whatever income tax bracket the driver is projected to fall in, after taking into account all sources of income), and also account for state income taxes.

 

s)  What can an Uber driver do, if he/she does not receive a 1099 from Uber?

Uber drivers should keep accurate records of all the income received and claim all the income on their tax return even if they don’t receive a 1099 from Uber. By law everyone is responsible for claiming all their income even if they don’t receive a 1099 from a company they do business with.

 

t) What is likely to happen if an Uber driver doesn’t report the income made driving for Uber?

Uber will report the income to the IRS, so if an Uber driver doesn’t report the income they earned driving for Uber, the IRS will send the person a proposed notice of adjustment and they will be taxed on the entire gross income reported by Uber without accounting for any expenses.  The worst thing that anyone can do is not report on their tax return income they earned because the IRS will match up the 1099 reported and adjust their tax return without deducting any expenses. Depending on the amount of income that is not reported, the Uber driver may get audited. The ramifications for not reporting income earned can be serious so it’s advisable that an Uber driver claim all the income earned and deduct all their business expenses correctly.

 

u) Since you have helped Uber drivers prepare their taxes, what common problems have you seen?

The most common problem is record keeping for their expenses.  This tends to be a problem for many self-employed people.

 

v)Can our readers reach you, if they are looking for help with their 2015 taxes?

Yes, readers can find out more about me at www.savvytaxguy.com and can contact me at (770) 938-6300.

 

w) Any last words?

Uber drivers should keep accurate records of their expenses because if they ever get audited the IRS will disallow any expenses claimed on the tax return that [can’t] be substantiated with supporting documentation.  Good record keeping goes a long way.  Additionally, paying estimated quarterly taxes is important so an individual doesn’t owe at year-end and have to pay penalties and interest.

 

For more information about Andrew Poulos, and to drop him a note follow the links below:

Andrew Poulos – Twitter

Andrew Poulos – Website

Andrew Poulos – Email

 

To receive professionally vetted information that will assist you in running a profitable Uber business whilst staying insured download our Uber kit at the top right of this page.

 

 

Become an Uber Driver

Other Interesting Uber Related Posts

For our blog posts on some of Uber’s Services, see the links below:

For other popular posts you might be interested in, check the links below:

 

Uber Taxes : Perspectives From an Industry Expert – Micah Fraim

 

 

 

Micah Fraim, Uber Taxes

There are only two things you cannot escape in life – taxes and death. The former at least you can prepare for. To help you prepare for your upcoming tax filing we did a Question and Answer session (Q & A session)  with Micah Fraim, a very knowledgeable CPA (Certified Public Accountant) and owner of his own Accounting firm.

If you are interested in Uber Taxes, Micah is very knowledgeable about taxes as it affects Uber drivers, and workers in the “on demand” (gig) industry as a whole:  Read the full Q & A below to find out his expert opinion and general thoughts as it relates to Uber and your taxes.

 

a) What is your name?

Micah Fraim

 

b)Where do you work, and what is your position/title?

I am the owner of Micah Fraim, CPA.

 

c)What does your job entail?

My job includes advising clients on all aspects of their businesses with a focus on tax planning, business planning, and marketing advisory services.

 

d)What is your general opinion on the Uber business?

It is a nice secondary option to traditional cabs and can (in some cases) be a good way to make money on the side.

 

e)Where do you stand on the widespread notion that Uber is disrupting long held industry regulations? (specifically relating to W2 vs. independent contractor classification of workers)

I was surprised by the decisions in California and Florida because in many ways Uber drivers fit the classification criteria to be considered 1099 subcontractors.

 

f)What would happen to Uber drivers in the US, if they become classified as W2 employees?

There are two major shifts that would occur if Uber drivers became classified as W-2 employees:

  1. As 1099 subcontractors, Uber drivers are de-facto self-employed. This means that they are responsible for both sides of Social Security and Medicare on any profit. It also means that any expenses in their business are fully deductible
  2.   As W-2 employees, Uber drivers would only be responsible for paying half of Social Security and Medicare taxes while Uber would pay the other half; however, deducting their expenses becomes much more difficult. As W-2 employees, Uber drivers will now become “unreimbursed employee expenses” that fall under itemized deductions. Two things happen here:
    •   In order to deduct the expenses, total itemized deductions must exceed the standard deduction ($6,300 for single taxpayers and $12,600 for married couples)
    • The unreimbursed expenses are subject to a threshold of 2% of your Adjusted Gross Income. That first 2% gets disallowed automatically.
  3. So while the notion of classifying Uber drivers as employees on the surface sounds like a favorable change for them, it might actually end up costing them money in some cases – unless Uber reimburses them for expenses as well.

 

g)What are the major differences in taxation between someone driving for Uber full time and someone driving part time?

From a tax standpoint and under the current setup, there is no difference between driving Uber full time and driving part time. Note- Labor commissions like California and Florida might take a different view.

 

h)Do I have to file quarterly tax reports, as a self-employed person in an Uber driving role?

The only quarterly forms that are required (unless the driver runs payroll for themselves), would be quarterly estimated tax payments to the IRS and state. Failure to do so will result in a small penalty for not paying throughout the year.

 

i)What does an Uber driver need to do from the start of the business to ensure that they never have issues when filing their taxes?

Good record keeping and planning from the start of your Uber business are vital. Keeping track of all expenses, monitoring your profit, and setting aside money for tax payments are all very important because there is no employer to do any of that for you.

 

j) What professional advice would you give an entrepreneur hoping to operate a fleet of cars as regards taxes?

Cash outflows do not always equate to reductions in taxable income. If you take on debt, the principal portion of the loan repayments is not an expense for tax purposes. Be very careful in your planning to make sure these discrepancies do not get you into trouble.

 

k) Would you advise an Uber driver/Partner to form an LLC in order to operate his/her Uber business?

A single member LLC can make sense from a legal standpoint to potentially shield against liability, but from a tax standpoint an LLC is treated the same as a sole proprietorship. In the right situations an S-Corp can make sense and save you on taxes.

 

l)Standard Mileage or Track Expenses? What is the better option for an Uber driver/Uber partner?

For most vehicles (and over the long-term) the standard mileage deduction is the safer bet. There can always be exceptions, so drivers should at least track mileage as well.

 

m) What are the top deductions that an Uber driver needs to track?

Mileage and auto expenses are obviously the most important. Beyond that, the business percentage of their cell phone, home internet bill, and other expenses like office supplies, computer equipment, etc. should all be tracked.

 

n) What tools do you recommend for an Uber driver to use to track their various expenses?

QuickBooks or QuickBooks Online/Xero are good approaches. For very simple bookkeeping a spreadsheet can also work.

 

o) What is the best way for an Uber driver to estimate taxes for the current year, so they don’t have a cash flow situation come tax time?

Checking in with a tax professional throughout the year is always the best idea. Short of that, setting aside 30-40% of their business profit for taxes can be a good approach.

 

p) What can an Uber driver do, if he/she does not receive a 1099 from Uber?

Contact Uber directly to ensure one has been issued. Failure to report the income can cause serious headaches down the road.

 

q) What is likely to happen if an Uber driver doesn’t report the income made driving for Uber?

If the driver makes over $600 in the year, Uber is required to issue the Uber driver a 1099-MISC form and also file that with the IRS. If the Uber driver fails to report the income, the IRS will almost certainly flag it and require payment on the additional income. Note- the IRS’ tax figure will usually be worse than if the driver had actually claimed the income in the first place.

 

r) Can our readers reach you, if they are looking for help with their 2015 taxes?

FraimCPA.com

 

s) Any last words?

I’m available for anyone needing their taxes prepared or help growing and managing their businesses

 

For more information about Micah Fraim, and to drop him a note follow the links below:

Micah Fraim – Website

Micah Fraim- Twitter

Micah Fraim – Facebook

 

To receive professionally vetted information that will assist you in running a profitable Uber business whilst maximizing your profits, download our Uber kit at the top right of this page.

 

 

Become an Uber Driver

Other Interesting Uber Related Posts

If you liked our post on Uber Taxes, see other  informative Uber related posts below:

For other popular posts you might be interested in, check the links below:

 

Uber Taxes:  Perspectives From an Industry Expert – Anil Melwani

 

 

 

Anil Melwani, Uber Taxes

Anytime I think about taxes, I think of the unnecessary and unavoidable journey of pain I am about to embark on. For most Uber drivers in the United States, I am sure it is the same and as such, we decided to do a Question and Answer session (Q & A session) centered on Uber Taxes with Anil Melwani, the president of a tax firm, who has over 16 years of experience in Accounting.

Anil is very knowledgeable about taxes as it affects Uber drivers, and workers in the “on demand” (gig) industry as a whole, as shown in his responses below.  Read the full Q & A below to find out his expert opinion and general thoughts as it relates to Uber and your taxes.

 

a)What is your name?

Anil Melwani

 

b)Where do you work, and what is your position/title?

I work at 212 Tax & Accounting Services and I am the President of the firm.

 

c) What does 212 Tax & Accounting do?

We operate a full service C.P.A. (tax and accounting) firm.

 

d)How long have you managed your own company?

Since 2008.

 

e)What is your general opinion on the Uber business?

I love Uber.  I use it for work purposes. I also use Uber for me and my family almost every day.   The typical Uber is usually much more comfortable for us to ride in than a yellow cab.   We [my family] live and work in Manhattan.

 

f)Where do you stand on the widespread notion that Uber is disrupting long held industry regulations? (specifically relating to W2 vs independent contractor classification of workers)

From my understanding most if not all Uber drivers are treated as independent contractors.   As a licensed C.P.A who focuses on preparing and filing tax returns for individuals and businesses, this seems completely fine and legal to me.

 

g)What would happen to Uber drivers in the US, if they become classified as W2 employees?

 It probably won’t be beneficial for most of them, because they won’t be able to write off and take advantage of the several tax deductions that they are able to as independent contractors.  But on a W-2, Uber would be responsible for paying half of the self-employment taxes (FICA/SS [social security] and Medicare taxes), so it wouldn’t be all bad for the drivers.

 

h)What are the major differences in taxation between someone driving for Uber full time and someone driving part time.

Not much if they are both classified as independent contractors. The full time driver should have more income and expenses to report.

 

i)Do I have to make quarterly tax payments, as a self-employed person in a part-time Uber driver role?

Most self-employed taxpayers should be PAYING (not filing) their taxes quarterly in the form of estimated tax payments.

 

j)What are the various types of tax considerations that impact an Uber partner and/or driver?

 

  1. An Uber driver needs to make sure that the depreciation on the cost of his/her vehicle is calculated and reported correctly. This is probably the most confusing issue for most Uber drivers.
  2. An Uber driver also needs to keep track of the car mileage and Uber trips just in case of an IRS audit.
  3. Making sure you are keeping good books, records, receipts, and invoices of all business related expenses such as gas, insurance, repairs & maintenance, license fees, cleaning, car wash, cell phone / Wi-Fi / computer and internet costs.

 

k)What does an Uber driver need to do from the start of the business to ensure that they never have issues when filing their taxes?

Keep good books & records (receipts, invoices, cancelled checks, credit card statements, bank statements) for at least three (3) years.   Make sure you review your tax returns to ensure it makes sense. Don’t just sign it and give it back to your accountant to e-file.   Consider using some kind of bookkeeping software such as Quickbooks or Xero.  There are several other more basic ones out there too like Freshbooks, Mint.com, and Zoho books.

 

l)What professional advice would you give an entrepreneur hoping to operate a fleet of cars as regards taxes?

Make sure your accountant is calculating the correct amount of depreciation each year on your tax return.  This is probably going to be one of your biggest write-offs and you (not your accountant) will probably be liable for additional taxes, penalties, and interest if it is not done correctly.  Also, see the previous answer.  You should definitely look into using formal bookkeeping software such as Quickbooks or Xero.

 

m)Would you advise an Uber driver/Partner form an LLC to operate his/her Uber business?

This question should be directed to an attorney.   For tax purposes, single member LLCs and regular sole proprietor are treated and taxed the exact same way.

 

n)Standard Mileage or Track Expenses? What is the better option for an Uber driver/Uber partner?

This is decided on a case by case basis for whichever is better for the taxpayer, but once one of the methods is chosen you must stick to that method for the life of the vehicle.

 

o)What are the top deductions that an Uber driver needs to track?

Gas, insurance, repairs & maintenance, license fees, cleaning, car wash, cell phone, Wi-Fi, computer  and internet costs.

 

p)What is likely to happen if an Uber driver doesn’t report the income made driving for Uber?

They will first receive a notice from the IRS and then if they don’t file an accurate return at that point they will have much serious issues with the IRS and State they are earning income in.   It is ILLEGAL not to declare ALL income.  Most WORLDWIDE income is reportable (and sometimes taxable) for U.S. citizens and green card holders.

 

q)Can our readers reach you, if they are looking for help with their 2015 taxes?

Of course!   We are at 212tax.com and 212-475-1040.

 

r)Any last words?

File your taxes early if you can.  We LOVE early filers!!

 

For more information about Anil Melwani, and to drop him a note follow the links below:

Anil Melwani – Website

Anil Melwani – Linkedin

Anil Melwani – Twitter

Anil Melwani – Facebook

 

To receive professionally vetted information that will assist you in running a profitable Uber business whilst staying insured download our Uber kit at the top right of this page.

 

Become an Uber Driver

Other Interesting Uber Related Posts

For our blog posts on some of Uber’s Services, see the links below:

For other popular posts you might be interested in, check the links below:

 

Perspectives on Uber Insurance From an Industry Expert

 

 

 

Solomon Eugene, Uber Insurance

Given the state of uncertainty as regards auto insurance for an Uber driver, especially in the United States, we decided to do a Q & A session (Question and Answer session) with Eugene J. Solomon, an Insurance expert licensed in multiple states and with over 25 years of experience.

Eugene has an interesting take on insurance for Uber drivers and leans more towards commercial insurance for Uber drivers (as a rule of thumb).  He also answers a lot of questions that Uber drivers have regarding coverage, and what to do if you get into an accident whilst driving with Uber. Read the full Q & A below to find out his expert opinion and general thoughts as it relates to Uber and insurance.

 

a) What is your name?

Eugene J. Solomon.

 

b) Where do you work, and what is your position/title?

My company is “Southern California”, and I am the Agency Principal.

 

c) What does your job entail?

We are a full service independent brokerage firm assisting clients with Auto, Home, Umbrella, Business, and Life Insurance

 

d) How long have you been in the insurance industry?

I began as a Claims Adjuster in 1990 before becoming a Full Time Agent in 1993

 

e) Where do you stand on the widespread notion that Uber is disrupting long held industry regulations? (Specifically relating to insurance)

If an industry is stagnated it’s important to have innovative companies come along and challenge those stagnant business models.  Regulation in itself can also be stagnant and should respond to the marketplace.

 

f) What is your general opinion on the Uber business?

I’m excited about Uber generally and what they can do.  Increased access for senior citizens who may not find cabs to service their area in addition to the job opportunities Uber creates; leave me with a positive impression. The convenience is incredible.

 

g) What is the conflict between the business model of Uber and standard insurance policies?

Uber’s innovative model disrupts the traditional insurance model by having a hybrid usage of your personal automobile.  Using your car as a livery conveyance and a personal auto is not something most insurance companies are prepared for.

 

h) What are the various types of insurance policies that impact an Uber partner and/or driver?

For Auto Insurance there are generally two categories:  Personal Auto and Commercial Auto.  Personal Umbrella Policies may be negatively impacted by driving with Uber as the underlying coverage may not be appropriate.

Editor’s Note – Our expert talks more about commercial insurance in the follow up questions.

 

i) What does an Uber driver need to do from the start of the business to ensure that they never have an insurance related problem?

The safest strategy is to insure your vehicle as a Commercial Vehicle right off the bat. As these policies are more expensive, factor the additional cost of insurance into your business plan.  If your vehicle is insured as a Commercial Vehicle, you should be able to avoid coverage issues that may arise if you only had a Personal Auto Policy.

Commercial Insurance allows for usages not typically covered under a personal use policy.  [Furthermore], Commercial Policies typically have much higher Liability Limits than personal use policies. Most, if not all, personal insurance policies exclude Livery, carrying passengers for a fee.

Our opinion is Commercial Insurance policies suit the Uber driver best.  Some companies are offering an Endorsement on personal auto polices but they can be just as expensive as a commercial policy.

Editor’s note– Your selection of insurance should be influenced by cost as well as coverage, since you are running a business. Also, depending on the class of Uber service you intend to run under, commercial insurance might not be necessary. See our UberX kit, and Uber Black kit’s for more information on this.

 

j) How does an Uber partner (with multiple drivers) go about insuring a fleet of cars intended to be used for Uber?

The most effective way to handle a fleet would be a Commercial Auto Policy.  Discounts and fleet pricing will help lower the cost vs. stand- alone coverage for each vehicle.[Also,] with luxury vehicles you may have additional equipment to insure.  However, from a standard coverage standpoint the basics [previously discussed] apply.

Also, if you have a fleet of vehicles to operate consider how you may want to insulate yourself from Liability claims.  Should you have Business Insurance?  An LLC or Corporation? Do you have multiple drivers and what is their relationship to you? Are your drivers classified as Independent Contractors or Employees?  Some States such as California have a presumption [that such a worker is an employee].  Have a candid conversation with an independent broker who represents many companies.

 

k) Can an insurance company just decide not to cover an Uber driver’s car when it is involved in an accident?

Most insurance provided by Uber with James River is Secondary to your individual policy.  First and best practice is to take a picture of the license plate of the other vehicle.  Document the scene and incident the best way possible – photos, witnesses, and police report.  If you have Uninsured Motorist Coverage, then injuries may be covered.  If you have Collision insurance and are insured properly, your vehicle damage may be covered.

 

l) If the answer to the previous question is yes, what are the possible situations?

An Insurance company can’t just decline a claim: They must have an investigation and valid reason to decline, pointing to an “Exclusion” contained in your policy.  If an Exclusion doesn’t apply they may point to your application with the insurance agent.  The agent would have asked about the vehicle usage (For example:  How many miles to and from work?  How many miles per year? Any other drivers?  Any passengers for a fee?). You sign the application and are held to the responses contained therein. If the company can determine you misrepresented any of the above they can “rescind” the contract and it’s as if you were never insured at all. It is very tough for insurance companies to deny a claim.  In California, for example, they may be accused of “Bad Faith” denying the claim in error which could lead to a large judgment against the company.  Each state will vary.

 

m) Why doesn’t Uber create a comprehensive Master Policy for Uber drivers?

Creating a Master Policy for all drivers could be good for the drivers but likely bad for Uber.  Master or Group pricing gives preferential and easier underwriting, higher coverage and lower prices for driver/owners.  However, by having a group policy another barrier is taken down toward defining Uber as a transportation employer rather than a tech company.

 

n) As an expert, would you say that Uber is obligated to cover their drivers?

My opinion is they should cover drivers as the primary insurance provider [from the moment the driver is available to pick up passengers].  Any business relationship is based on mutual trust and respect.  Uber drivers should be treated as equal partners in this enterprise.  Uber is not successful without their hard working network of drivers.

 

o) What documents will one need in the process of setting up an insurance policy for an Uber vehicle?

Driver information- names, ages, driver license numbers, garaging address, and vehicle identification numbers.

 

p) What is your general advice for Uber drivers who have been turned away from insurance companies because they drive for Uber or other ridesharing companies?

Contact an independent broker.  Having choices of carriers to place you with means better pricing and a better coverage fit.

 

q) Can our readers reach you, if they are looking for an insurance quote for their Uber vehicle? If so, how can they?

You can reach us on our website www.solomoninsurance.com or me via email. Note-With all of the required information a policy can be written over the phone in 30 minutes or so.

 

r) Any last words of wisdom to our Uber drivers/ Entrepreneurs?

Don’t try to cut corners on cost. Be honest about your vehicle usage.  Enough insurance companies have come into the market where you will find something.  The money you save today could come back in multiples when you have an uncovered claim. Information will vary across States.

For more information about Eugene J. Solomon (National License Number 2608162), and to drop him a note follow the links below:

 

Eugene J. Solomon – Linkedin

Eugene J. Solomon – Website

Eugene J. Solomon – Email

 

To receive professionally vetted information that will assist you in running a profitable Uber business whilst staying insured download our Uber kit at the top right of this page.

 

Become an Uber Driver

Other Interesting Uber Related Posts

For our blog posts on some of Uber’s Services, see the links below:

For other popular posts you might be interested in, check the links below:

Learn How an Uber Partner Made $675k in One Year

 

 

Uber Partners and Drivers

Given the recent rate cuts by Uber, this blog post might be comforting to some Uber partners and Uber drivers out there. Some Uber partners are still killing it. Here is some inspiration.

I had a Q and A session with Greg Palomino, who is an Uber Partner in San Antonio, Texas. Greg is also a business owner in the corporate events space with over 16 years of experience. From what I gathered from our discussion, Greg makes an average of $675,000 per year leveraging his gig as an Uber driver while only working about 12 hours a week on the platform. He has been doing this for just over 16 months now (he started driving for Uber in August 2014). Read the full Q and A below to find out how he has been able to make such an impressive amount; receive some tips and important information for Uber drivers; and some general thoughts he has about the Uber platform and how the Company can improve its service.

 

a) What is your name?

Greg Palomino

 

b) What city do you primarily drive in for Uber?

San Antonio, Texas

 

c) Do you drive for any other ridesharing service such as Lyft? If not, why?

I drive for Lyft as well.

 

d) What is your primary motivation for driving for Uber?

Uber was introduced to me by another business owner in a networking event back in August 2014. I was very skeptical and did not have time for another “job” as i own various companies and manage over 200 employees. However, once I got on the platform, I realized I could primarily use the platform for networking. The money that can be made through Uber is good and can even be great. However, when i get to know my riders and who they are, i sometimes get great business opportunities and sign contracts for my other businesses (see more on this below).

 

e) At what time of the day specifically do you drive?

I drive from 10pm to 4am Fridays and Saturdays if i am in town. This is when surges hit!  Riders need us the most and others are not willing to drive. This time of the night is more risky, but comes with a bigger reward.

 

f) Are you a professional livery driver?

I am not a professional livery driver, but i do drive under the Uber XL and Uber Select services in my market. They are practically the same as Uber LUX and Uber Black in most other markets.

 

g) About how much do you make in tips per week?

I earn about 25% of revenue in tips a week, so it can vary depending on the week.

 

h) Who tips better? The Drunk or Sober “passengers?

Passengers tip equally most of the time; however the excited ones tip better since they are usually in good spirits.

 

i) What do you do to encourage tipping from your passengers? Do you have any specific tips?

I do not encourage tipping from my passengers. I earn every tip, but most of the time it is a fairly decent tip. If someone asks if they can tip, i always let them know it is not encouraged or required.

 

j) How do you track your expenses for Uber? How do you plan for tax season?

I track my expenses by writing my total mileage down and my expenses for the vehicle. I divide the time i drove for Uber vs the time i used it for my other business. Since my car is new (and it is better to have a new car), everything is under warranty. Once the warranty runs out, i get another new car.  So my expenses are at a minimum.

 

k) How much do you spend on gas on a weekly basis?

I spend about $125 a week on gas on my Denali for the hours i drive.

 

l) Have you had any issues with people throwing up in your car, or any other incidents that are noteworthy?

Nobody has thrown up in my car yet; however one couple spilled a glass of red wine all over my backseat carpet, and that was not a fun ride. On top of that, the couple was very inebriated and irritated. The ride ended with a little argument, and the couple paying for their fare plus the cleaning fee.

 

m) What do you hate about being an Uber driver?

The only things i dislike about being an Uber driver are 1) The lack of attention and support to Uber drivers, and 2) The inconsistency with managing the quality of cars for a specific uber service on the road. I get comments all the time from Uber customers who selected an upgraded vehicle (Uber XL or Uber Select) but got some small compact car with faux leather seats. When these customers get in my Denali, they usually call me directly to pick them up in the future.

 

n) What would you like to see changed about the Uber Platform?

I think the Uber platform needs to be more precise about pickup addresses. It also needs to ask passengers how many people are in their party (to confirm the vehicle size). I believe that we [Uber drivers] also should get paid for the cancelled rides. It takes time to reposition our vehicle and sometimes we could have wasted 5 to 10 minutes getting to someone just to have them cancel when we arrive.

 

o) In our initial conversation ,you mentioned that you have put about $3M in your funnel, and closed 30% of it. Are you saying you have made 900,000 dollars off the Uber platform, or can you expand on that a little bit? Over what time period is this?

With the riders i have met, and the business i have conducted for my other companies, those numbers are fairly accurate. Whether it is an event or couple looking for an event planner, catering, venue, or travel help, i am their new go-to guy.

 

p) Do you have any closing thoughts?

I always run rides through the Uber app for ethical and moral reasons, even if the rider wants to pay me cash. I do this because it is the fair thing to do, and i also don’t want to lose my Uber driving privileges. I don’t have any contracts with my riders; however they know that if they need me for extended travel (outside the uber zones) they have to compensate me in other ways. I take cash or credit for those rides outside my market or for long haul destinations that start/end outside my market.  

One thing i would love to see Uber implement is long haul rides. It would be nice to take Uber passengers from Austin or Dallas to San Antonio for instance. I would be open to those rides, to make the most use of my time, when i am going out of town. Plus, most business professionals book last minute airfare at two to four times the normal fare ($200 to $800). A hypothetical long haul (400 mile) Uber ride can cost half the price of a last minute airfare.  Uber could bank big on this segment of the market. I know this market because i have been in the corporate events field for over 16 years. Just my 2 cents!

 

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