- Although Boomer’s Uber driver business had over $100,000 in revenue, his profit was only $20,000.
- Uber commissions and driving costs have significantly reduced its profitability.
- The driver shared why he planned to stop Works for Uber.
Dean Ceran spends a lot of time behind his wheel Kia Forte.
Since 2016, the 66-year-old has put 410,000 miles on his car. 90% of it came Driving for Uberhe told Business Insider.
In a typical week, Ceran works between 50 and 60 hours. He drives from 7:30 a.m. to 5:30 p.m. every weekday, except Wednesday—he keeps the same schedule on Saturdays, a day off—and then runs from 11:30 a.m. to 5:30 p.m. on Sundays. During his seven years as a driver, he made more than 26,000 trips.
“Prophets are the money I make and the people I meet along the way,” Ceran said of driving for Uber in Virginia. “The downside is the time it takes to track all the expenses.”
These expenses do more than just take up his time—they take a significant chunk of his earnings. Ceran had more than $103,000 in gross Uber income in 2023, according to a tax filing reviewed by BI. But then Uber took his cut and his driving expenses was recorded, his profit fell to about $20,000.
Even so, Ceran told BI that he has no plans to stop driving, and that’s a bit it’s harder to make money in recent years, he is still meeting his financial goals.
“Even after expenses, I’m still making good money driving for Uber,” he said.
Ceran is one of many Uber and Lyft drivers who actively monitor their high income and expenses to make sure the gig is worth their time. However calculations used by drivers – and what numbers they measure when evaluating their success – varies significantly. Some daily travel and profit objectivesothers care more about themselves per mile or per hour profit. Some focus on profitability later car expensesothers control them taxable income.
In recent months, several drivers have told BI that driving has become a chore brings less income than beforewhich many attribute to it increase in the number of drivers and changes in company algorithms they say it resulted low salary. Some drivers said closely controls their earnings was more important than ever.
Ceran shared his best strategy for making money and what motivates him to stick with the ride.
How commissions and driving costs cut into drivers’ profits
Of Cera’s roughly $83,000 in business expenses, $38,000 are Uber expenses. reservation and service charges – effectively Commission the company takes from the drivers’ earnings. Deducting $38,000 from his gross salary of $103,000 brought Cera’s Uber income to about $65,000.
But that’s before you factor in driving costs. For drivers, the cost of using their vehicles is a business expense that reduces their profits.
When filing your taxes, you have two ways drivers can calculate their business expenses. First, they can include gas, insurance, maintenance and other car expenses in a given year – but these can be difficult to track. Ceran estimates that in 2023 he spent $13,000 on maintenance, $9,000 on gas, $2,000 on car insurance and $800 on tolls.
Instead, many drivers choose the second option – IRS standard mileage discount.
This number varies from year to year, but in 2023, drivers may leave $0.65 such as transportation costs for each business mile they drive. This calculation is designed to account for driving costs such as gas and maintenance, so if a driver uses the mileage option, they not assumed to deduct these expenses elsewhere on their tax returns.
Lisa Greene-Lewis, a certified public accountant and tax expert at TurboTax, told BI, “You have to choose between using the standard mileage deduction or actual vehicle expenses like insurance, maintenance, etc.”
There is a little exceptions Greene-Lewis said this — costs including tolls, parking and free water for customers — can be deducted in addition to drivers’ mileage deductions.
Given that Ceran drove about 67,000 miles for Uber in 2023, his mileage was about $44,000.
When Uber’s $38,000 in commissions and $44,000 in mileage deductions are subtracted from its $103,000 gross profit, its business profit drops to about $21,000. Take an $800 fee and you’ll get about $20,000.
The success of Ceran’s business is to some extent in the eye of the beholder. After accounting for Uber’s commission — and before expenses — Ceran saw $65,000 in earnings from Uber hit his bank account in 2023. The $44,000 deduction was an estimate for tax purposes, so his actual car expenses may not be that high. The ability for some drivers reduces taxable income and paying less tax is a perk of the gig.
However, commissions and driving costs have significantly eroded the profitability of his business.
Accepting almost every ride helped him earn money
Even before he first tried Uber, Ceran had a lot of experience driving for a living. He said he drove town cars and limousines in the 80s and 90s.
His first year driving for Uber, 2016, was more eventful than expected: He got busted Hurricane Matthew While driving in Norfolk, Virginia.
“I actually stayed in the water up to the door for a couple of hours and didn’t pull up for 12 hours,” Ceran said.
In the years since that incident, he said Uber’s hours have changed a lot, but since 2019 it has been fully operational.
This is Cera’s main strategy accept almost every trip — its acceptance rate is 99%. When one ride ends, he said, he tries to get another as soon as possible.
“The idea is to let the app keep giving me rides and taking them so I keep riding and making money,” he said.
Some drivers made a choice different approach.
The biggest factor that negatively impacted his earnings was the amount of time he had to spend on car repairs — he said he’s been involved in several accidents over the years that weren’t his fault.
The main reason Cera keeps driving is because he’s satisfied with the income, but he said the gig is also there. social benefits.
“I love the interaction with the different people who request Uber rides,” he said.
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