What To Know Before Becoming a Rideshare Driver

Becoming a rideshare driver has become a popular method of earning extra money or an outlet for working on your own schedule. You might assume that all it takes to be a driver for apps such as Uber or Lyft is a driver’s license, a smartphone, and a working vehicle. However, prospective drivers must follow obligations set by rideshare apps and expert recommendations to become successful. Learn more about what it takes to be a rideshare driver.

All rideshare apps have their own driver and vehicle requirements as part of their driver application. Many of these qualifications are self-explanatory for the position, such as having a valid driver’s license and passing a background check. However, you may need to meet some criteria based on where you live, such as a minimum age and years of driving history. Most rideshare drivers must be over 21 years old and have at least one year of driving experience.

Depending on the app you choose, your vehicle must pass a rigorous inspection before you can become a rideshare driver. The rideshare vehicles that are eligible also depend on your area. Generally, vehicles must have four doors, be no more than 15 years old, and should have no cosmetic damage or commercial branding. You may be subject to additional requirements if you are applying for a specialty service such as Uber Black.

It is a common misconception that a personal auto insurance policy protects rideshare drivers. However, it’s more beneficial and often necessary for rideshare drivers to have a commercial auto insurance policy. This policy offers protection in case of an accident for a vehicle being used for commercial purposes and fills in any coverage gaps with your personal insurance policy.

The amount of money you make as a rideshare driver varies widely. Because you are an independent contractor, the government will not deduct taxes from your earnings. Drivers must save 20–30 percent of their income to pay federal, state, and self-employment taxes. One way to lower your owed taxes is to take a detailed account of work-related expenses to deduct from your gross income.

This is a summary of basic things to know before you apply to become a rideshare driver. Being aware of rideshare app policies and applicable local regulations is the first step to finding success in this side hustle. As you spend more time driving, you will learn ways to increase your profitability and customer satisfaction.