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Level 4
March 16, 2023
Question

Can rideshare and food delivery be on the same Schedule C?

  • March 16, 2023
  • 11 replies
  • 70 views
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11 replies

Level 8
March 16, 2023

I say 2 Sch C...they are not even remotely related businesses

rbynaker
Level 13
March 16, 2023

If it's the same vehicle used for both I would put them on one Schedule C.  Give the business a Russian sounding name like Pikup Andropov.

Level 7
March 16, 2023

Defiantly one schedule C.  Whether it is Food Delivery or ride sharing it is the same business. As a former Uber Driver there were times I would get a call for Uber Eats. 

Level 8
March 17, 2023

IRS says:

If you have multiple unrelated businesses organized as sole proprietorships, you generally should prepare separate Schedule C forms for each to report your business income or losses

Vehicle expenses are allocation by percentage of use by each business.

Intuit Community Champion
March 16, 2023

They have different activity codes 49200 for delivery drivers, and 485300 for ridesharing. I would use two schedules C

Skylane
Intuit Community Champion
March 16, 2023

If done correctly, the tax will be the same either way. Doesn’t really matter.

If at first you don’t succeed…..find a workaround
Level 8
March 17, 2023

IMO that would not be due diligence and would not be following IRS rules.

IRonMaN
Level 15
March 17, 2023

What due diligence?  The tax will come out exactly the same.  Exactly what crimes against humanity is the IRS going to charge someone with for using one schedule C for similar businesses?

Slava Ukraini!
dkh
Level 15
March 16, 2023

I'd complete one Schedule C using the business activity code for whichever had the highest gross income.

Same as I wouldn't use two Sched F  if farmer sold crops and cattle

IRonMaN
Level 15
March 16, 2023

I would put them on 3 schedule Cs .................................. only because that answer hasn't been given yet. 😜   But in real life I would stick with one schedule C.  Why over complicate things because the next thing you are going to ask how do I break out the expenses between the two schedule Cs.  Keep it simple.  The IRS is going to get the same amount of money from the client either way so why complicate your life.

Slava Ukraini!
rbynaker
Level 13
March 16, 2023

Yeah.  THE expense is mileage.  A friend of mine who does this will jump between jobs based on what's available.  People, take-out, groceries, whatever.  He even went through a certification process so now he can deliver wine and beer.  He has an app to track business mileage, might be too much of a stretch to get it broken down based on what's getting transported.  Bottom line, he gets paid to move X from point A to point B.

BobKamman
Level 15
March 16, 2023

One Schedule C.  They are closely related work.  Uber and Uber Eats -- it's just the smell of what you're delivering, that's different.  

Intuit Community Champion
March 17, 2023

I would put on one Schedule C. They are both delivery. 

Level 6
March 17, 2023

I would file one schedule C coded for delivery.  Food, groceries or people, it's still delivery.   The differences in the nature of the activities is not material and doesn't warrant the additional effort of separating them.  

Unless your client is tracking their trips by the character of their "freight", assigning vehicle expense proportional to gross receipts is more arbitrary than deciding to combine the two types of deliveries.  

The business activity codes are used by IRS as part of their audit project process.  I don't think they are going to conduct a project for one code and not include the other given the similarities of the issues.  

BobKamman
Level 15
March 17, 2023

We don't know how IRS uses the business activity codes, or whether they use them at all.  It's more likely they are used only by their "Research, Applied Analytics and Statistics Division" to produce reports that are used by government and private economists, mostly to write papers read by other economists.  Don't give credit to IRS for having more ability, the lack of which they demonstrate every day.  

Level 6
March 17, 2023

You have a point @BobKamman about just how they use the business activity codes.  However it's been rumored that they may use them for audit screening.  I'm sure you're correct that the data is mostly used for statistical purposes.  All the more reason to not get wrapped up in splitting hairs.