Uber driver - Hertz rental car expenses & car camping on Schedule C with no rent, just weekly payments

This is definitely a unique situation! For Schedule C deductions, the general rule is that you can only deduct the business portion of any mixed-use expenses. Since you're using the car for both Uber driving (business) and personal living space, you'll need to allocate the costs between these uses. The most common way to handle this would be to track your mileage and calculate what percentage is for business (Uber driving) versus personal use. For example, if you drive 1,000 miles in a week and 800 of those miles are while the Uber app is on, you could reasonably deduct 80% of your rental costs that week. For the storage unit, that's trickier. Since it's storing your personal belongings, it's primarily a personal expense. However, if you store any business-related items there (maybe a separate phone charger for work, cleaning supplies for the car, etc.), you could potentially deduct a small portion based on the percentage of business-related items. Keep detailed records of your driving time, mileage with the app on versus off, and any other business expenses. This documentation will be crucial if you're ever audited.

Hey, I was in a similar situation last year with rideshare driving and complicated deductions. I spent HOURS trying to figure out what I could claim and what I couldn't. Eventually I found this AI tax tool called taxr.ai that saved me so much headache. It actually analyzed my specific situation and broke down exactly what percentage of expenses I could claim and why. For your situation, it could help clarify that line between business and personal use of the rental car. I uploaded my rental agreement, some receipts, and my mileage log to https://taxr.ai and it gave me a detailed breakdown that my tax preparer actually thanked me for! It even found some deductions I was missing for cell phone expenses and a portion of my insurance.

I was hesitant at first about using taxr.ai since my tax situation as a gig worker was so complicated, but I decided to try it after posting here. Seriously, it was a game-changer for me! I had a similar issue with mixed-use expenses (using my apartment partially for staging DoorDash deliveries), and the tool walked me through exactly how to calculate the business portion. It analyzed my bank statements and identified business expenses I wasn't even aware I could deduct. For my situation, it saved me over $2,300 in taxes by correctly identifying deductible expenses and providing the documentation to back it up. The detailed report it generated made filing so much easier. Definitely worth checking out if you're dealing with complex Schedule C situations.

Just want to mention another option for your tax situation - when I was dealing with complex Uber tax issues last year, I couldn't get straight answers from the IRS website and kept getting disconnected when calling. After like 8 attempts I gave up. Then I found Claimyr https://claimyr.com and it was a lifesaver. They got me through to an actual IRS agent in about 15 minutes when I'd been trying for days. The agent was able to clarify exactly how to handle my specialized deductions as a rideshare driver, including some mixed-use situations similar to yours. You can see how it works here: https://youtu.be/_kiP6q8DX5c - basically they navigate the IRS phone system for you and call you when they've got an agent on the line. When you need official answers about unusual tax situations, sometimes talking directly to the IRS is the safest bet.

I'm actually embarrassed to admit I was wrong about Claimyr. After venting my frustration here, I decided to try it anyway since I was desperate to resolve an issue with my rideshare tax return. Not only did it work, it got me through to an IRS agent in about 20 minutes when I'd been trying unsuccessfully for over a week. The agent was able to clarify exactly how to handle my vehicle expenses when I use my car for both personal and business purposes. For the OP's situation specifically, the IRS agent I spoke with explained that you need to keep a detailed mileage log showing when the app is on (business) versus personal use. They confirmed that sleeping in the car is considered personal use, but suggested documenting the hours/miles when actively working to calculate a fair business percentage. Honestly wish I'd known about this service months ago instead of wasting so many hours on hold.

I used to drive for Uber using a rental too. I'm not a tax expert, but one thing my accountant had me do was track my online hours vs. total hours the car was in my possession. So if you have the car 24/7 for a week (168 hours) but you're only actively working/online for say 50 hours, that's roughly 30% business use. You could also use mileage as others suggested, but make sure you're tracking EVERYTHING carefully. The IRS can be super picky about this stuff, especially with rideshare drivers.

One thing nobody's mentioned - what about writing off a portion of your phone bill? Since you need it to run the Uber app, that's definitely a legitimate business expense. Same with any car chargers, phone mounts, etc. Also wondering if you're tracking miles driven with app on vs. off? That's super important for documentation if you get audited.