Effective Date: January 1, 2025
Last Updated: October 30, 2025
Overview
Ribit is a cost-sharing rideshare platform where drivers can receive contributions that do not exceed their actual costs for providing a trip. This cost-sharing model ensures that Ribit is not classified as a Transportation Network Company (TNC) under Florida law and maintains compliance with federal tax regulations.
Maximum Contribution Rate
70 cents per mile or less
This is the 2025 federal standard business mileage rate established by the IRS. This rate represents the full cost of operating a vehicle including:
- Fuel/gasoline
- Routine maintenance and repairs
- Tire wear and replacement
- Insurance
- Vehicle depreciation
- Registration and licensing fees
- Oil changes and fluids
How Driver Contributions Work
Setting Your Rate
- Drivers may set contributions up to a maximum of 70 cents per mile
- Drivers may choose lower rates (e.g., 50¢, 60¢, or 65¢ per mile)
- Additional direct costs may be shared proportionally:
- Tolls: Actual toll costs divided by number of passengers
- Parking: Actual parking fees divided by number of passengers
Prohibited Practices
DO NOT:
- Charge more than 70 cents per mile
- Add “convenience fees” or surcharges
- Use surge pricing or dynamic pricing
- Charge booking fees to riders
- Profit from rides
DO:
- Keep contributions at or below actual costs
- Split tolls and parking fairly among all passengers
- Be transparent about your rate calculation
Why This Matters
Legal Compliance
- Staying at or below the federal mileage rate keeps Ribit classified as cost-sharing, not commercial transportation
- This exempts drivers from TNC background checks, commercial insurance requirements, and for-hire vehicle regulations
- Maintains compliance with IRS guidelines for cost reimbursement
Tax Implications
- Contributions received at or below the federal rate are generally not considered taxable income
- Drivers should consult a tax professional for their specific situation
- Keep records of actual vehicle expenses for tax purposes
Examples of Compliant Cost-Sharing
Example 1: Gainesville to Orlando (85 miles)
- • Distance-based contribution: 85 miles × $0.70 = $59.50 maximum
- • With 2 riders: $29.75 per rider
- • Plus tolls (if any): Actual toll cost ÷ 2 riders
Example 2: UF to Tampa (125 miles)
- • Distance-based contribution: 125 miles × $0.65 = $81.25 (driver chose lower rate)
- • With 3 riders: $27.08 per rider
- • Plus parking: Actual parking cost ÷ 3 riders
Frequently Asked Questions
Q: Can I charge less than 70 cents per mile?
A: Yes! You can set any rate up to 70 cents per mile. Many drivers choose 50-65 cents per mile.
Q: What about wear and tear on my car?
A: The 70-cent federal rate already includes depreciation, maintenance, and wear costs.
Q: Can I charge for my time?
A: No. Cost-sharing only covers vehicle operating expenses, not time or labor.
Q: What if gas prices are higher than the federal rate assumes?
A: The 70-cent rate is designed to cover all costs on average. You cannot exceed this rate even if your local gas prices are high.
Q: Do I report this as income on my taxes?
A: Generally, true cost reimbursements are not taxable income. Consult a tax professional for your situation.
Annual Rate Updates
The federal mileage rate changes annually (usually announced in December for the following year). Ribit will update this policy when new federal rates are published. Current drivers will be notified of any changes through the app.
Questions?
Contact Ribit Support at ribitapp@gmail.com if you have questions about cost-sharing compliance.
This policy helps ensure Ribit remains a legal cost-sharing platform and that all users comply with applicable laws. Ribit is not providing tax or legal advice – consult professionals for your specific situation.