How to Report Your Income From Driving a Taxi in New York City
- 1). Create four columns in a ledger book. Title the first column "Date." Make the second column wider and title it "Description." Title the third and fourth columns "Expense" and "Income," respectively.
- 2). Mark down in your ledger every expense you have associated with driving your taxi on the day you pay it. This includes leasing fees, gas purchases and maintenance costs.
- 3). Add up the total amount of fares and tips you collected in cash at the end of each day. Write down this amount in the ledger. Since New York City requires electronic payment systems in taxicabs, write in your ledger how much in fares or tips you receive in electronic payments at least once per week or whenever those funds are paid to you.
- 4). Collect any receipts or payment records in a file folder. This will allow you to prove your expenses and income in the event of a dispute or financial audit. In addition, keep a record of any unusual payment arrangement, such as flat-fee agreements for airport trips, in your folder in case the New York City Taxi and Limousine Commission (TLC) requests information about payments or fees.
- 5). Add the numbers in your expense column together; then add the numbers in your income column together. Subtract your expenses from your income to determine your actual income, or what you take home. There is no specific time when this must be done, but it is often easiest to tally your numbers weekly.
- 6). Add all of your income columns at the end of the year to determine your yearly gross income. Then add all of your expense columns to determine your yearly expenses.
- 7). File your federal tax returns as a self-employed individual using Schedule C-EZ (or Schedule C if your expenses were greater than $5,000, as of 2011). In addition, you must file Schedule SE for Social Security and Medicare taxes. For other financial reporting, you can usually submit a copy of your signed tax return as verification of your income or provide a copy of your account ledger.
