Turo host taxes for 2026: the 1099-K, Schedule C, mileage vs. actual expenses and depreciation

Your 1099-K and what's in it

Turo sends a Form 1099-K when a host's gross earnings for the year are over $20,000 with more than 200 transactions, the federal threshold that applies again after the 2025 tax law, or over a lower threshold some states set. Turo posts 1099-Ks on your Tax information page and emails you when yours is ready; last year's were available by January 31. Every US host has to submit tax information to Turo either way, and Turo may pause payouts if you don't.

The number that surprises hosts is what's in box 1a. Turo's "gross earnings" include:

• Trip earnings
• Turo's fees (the part of each trip Turo keeps)
• Host incentives and host fees

Gross earnings don't include reimbursements or sales tax. So the 1099-K is higher than what landed in your bank account.

No 1099-K? The income is still taxable. The IRS says all income is taxable unless the law says otherwise, whether or not you get a form, and Turo's earnings summary gives you the same totals.

Schedule C or Schedule 1?

The IRS treats renting out vehicles as renting personal property. Where it goes depends on whether you're in the business of renting:

• In business (you host regularly and continuously to make a profit, which describes most hosts with a car dedicated to Turo): report income and expenses on Schedule C. Your net profit is subject to self-employment tax on Schedule SE, which is 15.3% on most of it, and you may qualify for the 20% qualified business income deduction.
• Not in business (an occasional rental of a car you mostly drive yourself): report the income on Schedule 1, line 8l, and the expenses on line 24b. No self-employment tax, but losses can't offset other income the same way.

Turo's own tax guide for hosts, prepared by EY, also notes that losses may be limited by the at-risk and passive activity rules if you don't materially participate. If your hosting shows a loss, that's worth a conversation with a tax professional.

Standard mileage vs. actual expenses

For each car you choose one of two ways to deduct the cost of the car itself.

Standard mileage rate

Multiply the car's business miles (guest trips plus your delivery and service driving) by the IRS rate. For 2026 the rate changed mid-year:

The rate replaces gas, maintenance, insurance, registration and depreciation, so you can't deduct those separately. You can still deduct Turo's fees, cleaning, parking and tolls, and the business share of car loan interest.

Three rules decide whether you can use it:

• Choose it in the first year. For a car you own, you have to use the standard rate in the first year the car is in business use. If you start with actual expenses, you can't switch to the standard rate later.
• Fewer than five cars at once. You can't use it for five or more vehicles used at the same time, which affects growing fleets.
• Switching out later is allowed, but then you depreciate the car straight-line.

Actual expenses

Add up what each car really cost to run (gas you paid for, maintenance, tires, repairs, insurance, registration, interest) plus depreciation, and multiply by the business-use percentage. A car that's only ever rented on Turo is 100% business; if you also drive it yourself, keep a log of your personal miles.

Which wins? It depends on the car. A newer, pricier car with high depreciation usually does better on actual expenses, especially in its first year. An older, paid-off car that racks up guest miles often does better on the standard rate. Because the first-year choice locks you in, run both before you file the first return for a new car.

Depreciation, bonus depreciation and the car limits

• Cars are five-year property, spread over six tax years under the regular rules.
• Bonus depreciation is back to 100% for vehicles acquired after January 19, 2025, used more than 50% for business. Cars acquired earlier get 20% if placed in service in 2026.
• Passenger cars are capped. For a car placed in service in 2026, first-year depreciation is limited to $20,300 with bonus depreciation, or $12,300 without it; then $19,800, $11,900, and $7,160 a year after that.
• SUVs and trucks: heavier vehicles are treated differently, and Section 179 expensing for an SUV is capped at $32,000. A tax professional can tell you whether a specific vehicle qualifies.

A big first-year deduction isn't free money: it lowers the car's tax basis, which matters when you sell it.

Expenses hosts can deduct

On top of the car itself (mileage or actual expenses), hosts commonly deduct:

• Turo's fees, which are already inside your 1099-K gross
• Cleaning, car washes, detailing and supplies
• Parking and tolls you weren't reimbursed for
• Repairs and damage costs that insurance or Turo didn't cover
• Accessories you rent out, like car seats, coolers and phone mounts
• Your phone and apps, for the business share
• Tax prep, bookkeeping software and an accountant

Turo reimbursements for gas, tolls or extra miles aren't in your gross earnings, so the costs they cover aren't deductible either; they wash out. A repair that improves the car, rather than keeping it running, gets added to the car's basis and depreciated instead.

Paying during the year

Turo doesn't withhold income tax from payouts. If you'll owe $1,000 or more at tax time, the IRS expects quarterly estimated payments. For 2026 income the dates are April 15, June 15 and September 15, 2026, and January 15, 2027. If you also have a job, raising the withholding on your paycheck works too.

Our free quarterly estimated tax calculator works out your 2026 self-employment and income tax, the safe-harbor amount, and what to pay by each due date.

When you sell a car

Depreciation you took (including the part built into the standard mileage rate) lowers the car's basis. If you sell the car for more than that lower basis, the gain up to the depreciation you claimed is taxed as ordinary income. Keep each car's purchase price, the depreciation taken every year and the sale price, so the math is easy when it's time to sell.

Records to keep

• Turo's yearly earnings summary and 1099-K
• Each trip's earnings, Turo fee and reimbursements (Turo's earnings CSV has them)
• A mileage log: odometer at the start and end of the year, plus your personal miles if you drive the car
• Receipts for every expense, by car
• Purchase documents, depreciation taken each year, and the sale price
• Insurance policies and claims, including what insurance or Turo paid
• Estimated tax payments

Quick answers

Tools for Turo hosts

Sources

• IRS: Form 1099-K FAQs (opens in a new tab) ($20,000 and 200 transactions; all income is taxable)
• Turo: US tax resources for hosts (opens in a new tab) (what gross earnings include, 1099-K timing, tax information requirement)
• Turo: General guidance on the taxation of business income (opens in a new tab), prepared by EY, Jan 2023 (Schedule C vs. Schedule 1, loss limits, deductions)
• IRS Topic 414: Rental income and expenses (opens in a new tab) (personal property rentals: Schedule C or Schedule 1)
• IRS: Standard mileage rates (opens in a new tab) (72.5¢ Jan-Jun and 76¢ Jul-Dec 2026)
• IRS: 2026 Instructions for Form 2106 (draft) (opens in a new tab) (first-year choice, five-vehicle rule, switching methods, $32,000 SUV Section 179 cap)
• IRS Rev. Proc. 2026-15 (opens in a new tab) (2026 passenger car depreciation limits and bonus depreciation)