As a driver for Uber or Lyft, you have the freedom to work where you want and when you want - and see the income flow in. But one thing to keep in mind as you’re driving is that you must file regular taxes. I know, I know: this seems pretty basic, but a lot of drivers have forgotten to do this and this could end up being very costly..

As a driver, you are a small business owner and you’re required to pay self-employment taxes on $400 or more in income at a tax rate of 15.3%, which goes to Social Security and Medicare. These taxes are required to be paid quarterly - generally by the 15th of April, June, September, and January.

Now it’s true that if you make under $20,000 driving, you may slip under the radar of the IRS, but you could be missing out on a variety of tax benefits and tax reductions, such as fuel, maintenance, insurance, and other car-related expenses. You can even claim 53.5 cents per mile in tax deductions.

So make sure to keep accurate records - even though Uber or Lyft are sending you a 1099k tax form that shows you all you earned in a whole year - so that you can handle your taxes properly and get the maximum benefit of deductions.