73 Pages Posted: 12 Feb 2016 Last revised: 3 Mar 2017
Date Written: February 10, 2016
In this Article, we investigate the tax issues and challenges facing Uber and Lyft drivers by studying their online interactions in three internet discussion forums. Using descriptive statistics and content analysis, we examine (1) the substantive tax concerns facing forum participants, (2) how taxes affect their driving and profitability decisions, and (3) the degree of user sophistication, accuracy of legal advising, and other cultural features of the forums.
We find that while forum participants displayed generally accurate understandings of tax filing and income inclusion obligations, their approaches to expenses and deductions were less accurate and more varied in sophistication and willingness to comply with tax law. Forum participants also frequently discussed whether driving was profitable and exhibited a range of awareness concerning how taxes affected profitability. Finally, while the forums contained a surprising degree of sophisticated and accurate tax and legal advice, they also contained many examples of inaccurate or confusing information. It is thus uncertain whether readers can successfully distinguish between accurate and inaccurate advice dispensed in the forums.
Based on our findings, we make tentative recommendations for effective tax administration in the ridesharing and related sectors, including use of industry-specific guidance, clarification of how existing tax rules apply to ridesharing, and guidance on Form 1099-K interpretation. We analyze the implications of our findings regarding taxes and profitability for Uber’s business model and its potential regulation. Finally, we discuss the possible impacts of targeted tax compliance initiatives on internet communities.
Keywords: sharing economy, 1099 economy, gig economy, Uber, lyft, peer to peer consumption, ridesharing, taxation, tax policy, tax administration, labor law, empirical legal studies, law & society, law in action, cyberspace, internet, qualitative analysis, content analysis
JEL Classification: H20, H24, H25, H26, H29, H52, J41, K20, K23, K34, L51, L62
Suggested Citation: Suggested Citation
Oei, Shu-Yi and Ring, Diane M., The Tax Lives of Uber Drivers: Evidence from Internet Discussion Forums (February 10, 2016). Columbia Journal of Tax Law, Vol. 8, 2017; Tulane Public Law Research Paper No.16-4; Boston College Law School Legal Studies Research Paper, No. 391. Available at SSRN: https://ssrn.com/abstract=2730893 or http://dx.doi.org/10.2139/ssrn.2730893
By Jack Manhire