Gig Worker Tax Guide — Uber, DoorDash, Instacart, and Freelance Taxes
If you earned money through Uber, Lyft, DoorDash, Instacart, Etsy, Fiverr, or any other gig platform, the IRS considers you self-employed. That means no taxes are withheld from your earnings — and you owe both income tax AND self-employment tax (15.3%). Here's how to stay on top of it and keep more of what you earn.
Estimate your total tax bill with the Self-Employment Tax Calculator→How Gig Income Is Taxed
| Tax Type | Rate | On What |
|---|---|---|
| Federal income tax | 10-37% (your bracket) | Net profit after deductions |
| Self-employment tax | 15.3% (12.4% Social Security + 2.9% Medicare) | Net profit |
| State income tax | 0-13.3% (varies) | Net profit |
The surprise: That 15.3% self-employment tax hits on top of your regular income tax. As a W-2 employee, your employer pays half. As a gig worker, you pay it all.
Example: $30,000 in Gig Income
| Tax | Amount |
|---|---|
| Self-employment tax (15.3% × 92.35%) | $4,236 |
| Federal income tax (22% bracket, after deductions) | ~$3,200 |
| State income tax (5% example) | ~$1,200 |
| Total tax owed | ~$8,636 (28.8%) |
Without deductions, nearly a third of your gig income goes to taxes. Deductions are essential.
Your 1099 Forms
| Form | From Whom | Threshold |
|---|---|---|
| 1099-NEC | Platforms paying you $600+ | $600 |
| 1099-K | Payment processors (Uber, DoorDash, etc.) | $600 (as of 2024+) |
No 1099? You still owe taxes. Even if a platform doesn't send a 1099 (you earned under $600), you must report all income.
Deductions That Save You Money
Mileage (Usually the Biggest Deduction)
| Method | 2026 Rate | How It Works |
|---|---|---|
| Standard mileage | $0.70/mile (estimated) | Track miles driven for work, multiply by rate |
| Actual expenses | Varies | Track gas, insurance, repairs, depreciation — deduct business % |
Standard mileage is simpler and often better for gig drivers. Track every mile from when you turn on the app to when you turn it off (including driving to pick up orders and between gigs).
Example: 15,000 gig miles × $0.70 = $10,500 deduction. On $30,000 income, that's a 35% reduction in taxable income.
Phone and Data Plan
| Deduction | How Much |
|---|---|
| Phone bill (business %) | 50-75% of monthly bill |
| Phone purchase | Business % of cost |
| Phone accessories (mount, charger) | 100% if used for gig work |
If you use your phone 60% for gig work, deduct 60% of your monthly bill.
Other Common Deductions
| Expense | Deductible? |
|---|---|
| Insulated delivery bags | Yes (100%) |
| Tolls and parking (while working) | Yes |
| Car washes (for rideshare) | Business % |
| Supplies (bags, napkins, water for passengers) | Yes |
| Safety equipment (dashcam, first aid kit) | Yes |
| Platform fees and commissions | Already excluded from your 1099 |
| Health insurance premiums (if self-employed, no employer plan) | Yes (on Form 1040) |
| Home office (if you do admin work at home) | Simplified: $5/sq ft, up to 300 sq ft |
| Tax preparation software or CPA fees | Yes |
What You Cannot Deduct
| Expense | Why Not |
|---|---|
| Commute from home to first gig | Personal commute |
| Traffic tickets or fines | Personal penalties |
| Clothing (unless uniform/costume) | General clothing is personal |
| Meals while working (your own food) | Personal expense |
Quarterly Estimated Taxes
The IRS expects you to pay taxes four times a year, not once in April.
| Quarter | Income Period | Due Date |
|---|---|---|
| Q1 | January - March | April 15 |
| Q2 | April - May | June 15 |
| Q3 | June - August | September 15 |
| Q4 | September - December | January 15 (next year) |
How Much to Pay
Simple method: Set aside 25-30% of every gig payment in a separate savings account. Pay quarterly.
Safe harbor method: Pay at least 100% of last year's total tax liability (110% if AGI was over $150,000) divided by 4. This guarantees no underpayment penalty even if you owe more.
What Happens If You Don't Pay Quarterly
| Consequence | Details |
|---|---|
| Underpayment penalty | ~8% annual interest on amount owed |
| Large April bill | Entire year's taxes due at once |
| No criminal penalty | It's a financial penalty, not a crime |
How to File
Forms You'll Need
| Form | Purpose |
|---|---|
| Schedule C | Report gig income and deductions |
| Schedule SE | Calculate self-employment tax |
| Form 1040 | Your main tax return |
| Form 1040-ES | Quarterly estimated tax payment vouchers |
| Schedule 1 | Report additional income and deductions |
Filing Steps
- Add up all gig income (1099s + unreported income)
- Subtract all business deductions on Schedule C
- Calculate self-employment tax on Schedule SE (net profit × 92.35% × 15.3%)
- Deduct half of SE tax on Schedule 1 (above-the-line deduction)
- Add net profit to other income (W-2, etc.) on Form 1040
- Calculate total tax owed
Gig Work + W-2 Job
If you have a regular job AND gig income:
| Tip | Details |
|---|---|
| Adjust your W-4 | Increase withholding at your day job to cover gig taxes |
| Use the "Extra withholding" line | Request extra $ withheld per paycheck |
| Still file Schedule C | Gig income is reported separately from W-2 |
| Tax brackets apply to combined income | Gig income is taxed at your top marginal rate |
Example: You earn $50K from your job (22% bracket) and $15K from DoorDash. The gig income is taxed starting at 22% — not 10%.
Tracking Tools
| App | Features | Cost |
|---|---|---|
| Everlance | Auto-mileage tracking, expense categorization | Free / $8/month |
| Stride | Mileage + expense tracker designed for gig workers | Free |
| MileIQ | Automatic mileage detection, swipe to classify | $5.99/month |
| QuickBooks Self-Employed | Mileage, expenses, quarterly tax estimates, filing | $15/month |
| Hurdlr | Real-time income/expense/mileage tracking | Free / $10/month |
Start tracking from day one. If you're audited, "I drove about 15,000 miles" without a log won't hold up. The IRS requires a contemporaneous record (tracked at or near the time of the trip).
Platform-Specific Tips
Uber/Lyft Drivers
- Download your annual tax summary from the driver dashboard
- Deduct: mileage, phone, car cleaning, water/snacks for passengers
- Your 1099-K shows gross fares — Uber's commission is already excluded from your income
DoorDash/Instacart/Grubhub
- Mileage is your biggest deduction — track pickup to delivery AND between orders
- Deduct: insulated bags, parking, tolls
- Hot bags provided by the platform are free — but replacements are deductible
Etsy/eBay Sellers
- Deduct: materials, shipping, packaging, platform fees, photography equipment
- Home office deduction for dedicated workspace
- Cost of goods sold reduces your gross income
Freelancers (Fiverr, Upwork)
- Deduct: software/tools, home office, internet, professional development
- Platform fees are already excluded from your 1099 income
- Consider an S-Corp election if profit exceeds $40,000+ (save on SE tax)
Bottom Line
Gig income is taxed at your regular income tax rate PLUS 15.3% self-employment tax. Track every mile, keep receipts for every business expense, and pay estimated taxes quarterly to avoid penalties. Mileage is usually your largest deduction — 15,000 miles at $0.70/mile saves over $10,000 in taxable income. Use a tracking app from day one. If you earn significant gig income ($40,000+), consider consulting a tax professional about an S-Corp election to reduce self-employment tax.
Use the Self-Employment Tax Calculator to estimate how much you owe on your gig income.
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