I rented my car using Relayrides (peer to peer car sharing) and made around $1000, and I have more than enough expenses (repairs, depreciation, oil changes...etc) to claim that $1000, I have a few questions while filling out Schedule c ez

Part 3 of Schedule c ez

1. line 5: Of the total number of miles you drove your vehicle during 2014, enter the number of miles you used your vehicle for:
I haven't driven any miles for business, the people who rented my car did and do I have to fill in the number of miles? Business, Commuting, Other sections?
If so, does Other mean number of miles I drove for personal use?

2. Question regarding 8a. Do I have to have an evidence to support depreciation?
I do have evidence in receipts for other expenses though.

Thank you so much.

My very personal advice is to throw the entire Sch C in the trash. More red flags from the IRS than it's worth. Are you a licensed car rental service with your state, and do you have the required extra liability insurance on the car?

Under the radar for now. Like selling your stuff from around the house on ebay only a lot more risky.

Quote:

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Originally Posted by joypulv

My very personal advice is to throw the entire Sch C in the trash. More red flags from the IRS than it's worth. Are you a licensed car rental service with your state, and do you have the required extra liability insurance on the car?

Under the radar for now. Like selling your stuff from around the house on ebay only a lot more risky.

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I felt like it but, IRS clearly states that the all income/revenues must be reported.

I am not a licensed rental service guy, I did it as hobby which IRS considers it a small business I guess. The extra liability insurance is purchased by customers through relayrides. Relayrides takes around 30% of the rental for my listing and other expenses.

My question for you would be, Wouldn't it be more risky not to report the $1000 revenue to IRS? On the bright side, I haven't received a 1099 from relayrides.

Did you get a 1099?

Quote:

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Originally Posted by ScottGem

Did you get a 1099?

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No I didn't.

I contacted relayrides, and I was told I didn't make enough so they won't issue me a 1099-K

RelayRides is correct; it is NOT enough for a Form 1099-K.

That does NOT relieve you of the requirement to file the Schedule C and report the income.

If you claim all of the expenses for the car (repairs, insurance, gas, etc.), those expenses are prorated based on the Relay Rides miles.

Example: You drove the car for the entire year 10,000, and RelayRides mileage is 1,000 miles. Hence, all of your expenses are divided by 10 to determine what to put on the Schedule C.

The EASIER way is to report the RelayRides miles and take the standard 56.5 cents per mile deduction for the costs of the car.

Dear AtlantaTaxExpert,

Yeah sounds like a standard deduction is a easier way to report my costs.

One last question, for the number of miles logged by my customers, I don't have a written proof of how many miles each customer logged except for my verbal statement(But I do have the documentation for trip mileage limit for each customer.) Would it be enough for IRS to accept it, Just in case if I get audited ?

I do not think the IRS will ever come back on you for the mileage claim UNLESS the mileage is excessive. In the future, note the mileage on the car before and after the RelayRides so you can log and track it.

Thank you. I will make sure to note the mileage in future.Just to make sure, here is what I wrote on my tax returns.

Do you have evidence to support your deduction? I wrote Yes for this

If "Yes" is the evidence written ? I wrote No for this.

Please correct me if i am wrong.

I have also sent you an email regarding your pricing structure, please do respond for it when you get a chance.

At last check, I had 34 emails in my InBox. I should get to it sometime today