If you don't own your rideshare vehicle and instead rent it weekly through a program like Hertz's rideshare rental partnership, your deduction generally runs through your actual rental and operating costs, not the standard mileage rate, because the standard rate is built to cover ownership costs you are not actually paying.
Source: IRS Publication 463, on standard mileage vs. actual expenses for leased and rented vehicles.
What the standard mileage rate is actually built to cover
The IRS standard mileage rate bundles an estimate of depreciation, insurance, maintenance, and fuel into a single per-mile figure. A driver who owns their car is genuinely bearing all of those costs, so the rate approximates their real expense. A driver paying a weekly rental fee that already bundles insurance and maintenance into that fee is not bearing those same costs the same way, which is why simply applying the standard rate on top of the rental fee risks deducting some costs twice.
The more defensible approach for a weekly rental
Deduct the actual weekly rental fee itself as a business expense, along with fuel, tolls, and any costs not already bundled into the rental price, rather than applying the standard mileage rate on a vehicle you do not own and are not depreciating. This tracks your real out-of-pocket cost structure directly instead of estimating it through a rate built for owned vehicles.
Why a mileage log still matters even without the standard rate
Even on the actual-expense method, business-use percentage still has to be established, and that requires a mileage log the same as any other method. If you use the rental vehicle for both rideshare work and personal errands, your rental fee and other costs get allocated by that business-use percentage, business miles divided by total miles driven in the rental period.
A worked example
A driver rents a vehicle for $380 a week, all-inclusive of insurance and standard maintenance, and drives it 90 percent for rideshare work and 10 percent personal. The deductible share of that week's rental fee is $342 (90 percent of $380), plus fuel and tolls incurred during business driving, logged separately. No standard mileage rate is layered on top of the rental fee itself.
When the standard rate can still make sense
If you have a longer-term lease, rather than a short-term weekly rental, the standard mileage rate remains an option, but choosing it locks you into using it for the entire lease period, including any renewals. Because the rules genuinely differ between a true lease and a short-term weekly rental, and this is an area where reasonable positions vary, compare the actual numbers for your specific rental or lease arrangement, and check with a tax professional before deciding.
Can I switch between actual expenses and standard mileage on a rental car partway through the year?
No, the method choice applies for the vehicle's period of business use within the tax year and should not be switched mid-year for the same rental period.
Does the weekly rental fee itself need documentation beyond the receipt?
Keep the rental agreement and weekly payment records along with your mileage log establishing business-use percentage. Together they support the allocated deduction if it is ever reviewed.
What happens if you switch rental companies mid-year
Renting from Hertz one month and a different company the next does not reset anything about the method question. Each rental period is evaluated on its own terms, actual weekly fee against business-use percentage for that period, and the records simply need to track which rental agreement covered which stretch of driving. Keep each rental's paperwork filed separately rather than merging them into one combined total, so a reviewer can trace any given week back to its specific agreement and rate.
Do platform-specific rental programs like Hertz through Uber change the tax treatment at all?
No, a rental arranged through a platform partnership is still a rental for tax purposes. The same actual-expense allocation applies regardless of which company you rented through or how you found the program.
Why rental-fleet drivers often skip the comparison entirely
Drivers renting through a platform's fleet program tend to focus on whether the rental math works out against their earnings, and understandably give less thought to which deduction method applies once tax season arrives. That's a missed step, since the actual-expense allocation on a weekly rental can produce a meaningfully different deduction than defaulting to the standard mileage rate out of habit, and the gap compounds over a full year of consistent weekly renting.
It's worth running the actual numbers at least once per rental arrangement rather than assuming last year's method still applies, since rental terms, insurance bundling, and weekly rates can all change between one rental agreement and the next, even with the same rental company.
Whichever method applies to your rental, the mileage log behind the business-use percentage still needs to be solid. Try TruMile →
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