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How Much Does it Cost to Become a Cab Driver in New York?
Taxi drivers and chauffeurs in New York City earned an average of $33,410 per year as of May 2013, according to the Bureau of Labor Statistics. This is significantly higher than the national mean salary of $25,200, and New York is the fifth highest-paying metropolitan area for this occupation. However, the cost of becoming a New York City taxi driver can be steep, with licensing fees alone easily totaling more than $500.
To receive a taxi license from the New York City Taxi & Limousine Commission, you must complete a number of various tasks and forms, many of which have an associated cost. Along with your application, you must submit an $84 one-year licensing fee and a $75 fingerprinting fee for your criminal background check. You must also provide the TLC with a copy of your state driving record, known as a Certified Abstract, which typically costs about $10 to $15 at your local DMV.
The TLC also requires a doctor’s signature on a medical examination form, for which costs will vary depending on your health care provider and insurance carrier. The commission also checks that you do not have any outstanding traffic violations or parking tickets, so pay off all outstanding fines before applying. After you submit your application, you must take a drug test at a TLC-approved facility, which costs about $26.
Training and Testing Costs
All New York City taxi driver licensing applicants must take a defensive driving course within six months of submitting their application. The course is six hours long and costs $50. You are also required to attend taxi school. Schools offer 24- and 80-hour courses, which cost between $125 and $325 depending on the number of hours. You must also take a pass an English proficiency test and take a written exam based on the course. Non-native English speakers can take an English and test preparation course, which typically costs around $20. A reservation for the exam costs $25. Finally, you must complete a $60 wheelchair accessible vehicle training course.
After receiving your license, you will still have a number of different costs for driving a taxi. Taxi drivers work in conjunction with taxi cab companies, and can be paid in one of two ways. You can earn a percentage of the gross fares -- typically one-third -- or you can rent the cab from the company for hours, days or weeks at a time. Those who rent their cabs pay about $100 per day, plus fuel costs. Many cab companies also require you to refuel the cab before returning it. Gas prices fluctuate, but generally New York state gas prices are much higher than the national average due to higher taxes, which come to a total of about 66 cents per gallon, notes WIVB.com.
In addition to gas costs and operating fees, taxi drivers are also often charged a percentage of the fare when passengers pay with a credit card. The fees vary, but can reach up to 10 percent, according to "Forbes."
Cab companies may also require you to carry your own general liability insurance, even though the company usually insures the vehicles.
Taxi drivers do not typically need to pay for parking -- taxi relief stands throughout the city allow drivers to park their vehicle or up to one hour so they can leave the cab and take care of personal needs. Many taxi drivers return their car to the company garage when they are done, even if they are renting it by the week, and therefore do not need to pay for parking overnight.
Marie Gentile has a passion for personal finance and style, and takes a special interest in the places where they intersect. She specializes in writing about money management and frugal living. Gentile has a bachelor's degree in journalism and has been published in several personal finance-related print and online publications.