DoorDash Tax Guide: How to Pay Taxes as a Dasher
Key Points
Here's what you need to know about taxes if you drive for DoorDash:
- You're considered self-employed and will need to pay income tax and Social Security/Medicare contributions on your own
- If you expect to owe at least $1,000, be sure to make quarterly estimated tax payments
- You'll get a 1099 from DoorDash if you make more than $600 for that year
- You need to report ALL your income, even if you don't get a 1099
- Lower your tax bill by tracking business expenses, like mileage and claiming deductions
- Report your income and business deductions on Schedule C of your 1040 form
Are DoorDash drivers considered self-employed?
Yes, DoorDash drivers are self-employed. DoorDash hires you as an independent contractor which means that the IRS counts you as a self-employed person.
You're responsible for providing your own tools and equipment (e.g. vehicle for deliveries, insulated tote bags for food, etc) and paying income and Social Security/Medicare payments.
The good news is that being self-employed lets you deduct business expenses on your taxes, but you need to document them correctly.
How to pay taxes as a DoorDash driver
Like most gig workers, you'll need to pay your taxes through estimated payments every quarter. As the name implies, you'll need to predict how much tax you may owe for the year and divide into four.
Here's a list of all taxes DoorDashers pay:
- Self-employment tax (15.3%): This covers Social Security and Medicare. You pay your share and the share normally covered by an employer.
- Federal income tax (% depends on total income): Like everyone else, you'll need to pay a percentage of your earnings to the federal government.
- State and local income tax (% depends on income): Applies if you live in a state/city with income tax.
Self-employment and federal income taxes are included in the same payment and are due on:
- April 15
- June 15
- September 15
- January 15 (to cover income from Q4 of the previous year)
State deadlines for estimated taxes can differ, so make sure to check. Luckily, making the actual payments is relatively simple and can be done through the IRS website or your state's franchise board's site.
Tax documents for DoorDash
If you earn more than $600 with DoorDash in a year, you'll receive a 1099 through Stripe (DoorDash's payment partner). You can also view your 1099 in the DoorDash app.
(Even if you don't get a 1099, you still need to report all your income, it's just that you won't receive a form.)
Be sure to check and update any information (like SSN, address, and name spelling) in your Stripe Express account before end of year. DoorDash will use this information to generate your 1099.
Work full-time somewhere else? You'll need to file both a W-2 (from your job) and any 1099s from gig work.
Tax deductions for Dashers
Let's talk about tax deductions, since they're by far the best way to lower the amount of tax self-employed people need to pay.
Here are some tax deductions DoorDash drivers can take:
- Mileage: Use a mileage app to record every trip with DoorDash
- Tolls and parking fees: These apply only if you pay for them while delivering/picking up orders
- Cell phone bill: You can deduct the business use portion (using the Dasher app to communicate with customers, for navigation, etc)
- Vehicle maintenance and repairs costs: If you use the actual expenses method, you can deduct the business use percentage.
Make sure you have proof (receipts, mileage logs) for every business deduction you claim. Otherwise the IRS can deny or make you pay back the deduction.
Where to report mileage for tax deductions
You'll fill out your DoorDash mileage (as well as mileage from any other gig apps) under "vehicle expenses" on Schedule C, line 9. After that be sure to fill out Part IV with additional vehicle information.
If you drive different cars for DoorDash or switched vehicles mid-year you'll need to attach additional pages with the form filled out for each one.
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