Taxes for Rideshare & Delivery Drivers (Uber, Lyft, DoorDash)
Driving for Uber, Lyft, DoorDash, or Instacart makes you self-employed in the eyes of the IRS — even if it’s a side gig. That changes how you’re taxed, and it opens up deductions a W-2 job never offered.
You’re running a small business
Your platform sends you a 1099 (often a 1099-NEC or 1099-K) and reports it to the IRS. That income goes on Schedule C, where you also subtract your business expenses. The net profit is subject to both income tax and self-employment tax.
The deduction that matters most: your miles
For most drivers, vehicle costs are the biggest deduction. You choose one of two methods:
- Standard mileage rate — a set amount per business mile. Simple, and usually best for higher-mileage drivers.
- Actual expenses — the business-use share of gas, insurance, repairs, depreciation, and more.
Either way, you need a mileage log. Track miles all year — app-based logs are fine — because reconstructing them in April rarely holds up.
Other commonly missed deductions
- Phone and data plan (business-use portion)
- Hot bags, phone mounts, and supplies
- Tolls and parking incurred while working
- Platform and service fees
Don’t get surprised in April
Because no one withholds tax for you, plan on quarterly estimated payments. Run your numbers with the Self-Employment Tax Estimator, then call if you’d like them checked.
Talk to an Enrolled Agent today
No forms, no phone trees — reach Chris directly about your tax situation.
Frequently asked questions
Can I deduct my mileage as a delivery driver?
Yes. You can deduct business miles using the standard mileage rate or your actual vehicle expenses — but not both. A contemporaneous mileage log is what the IRS expects to see.
Do I owe taxes if I drove part-time?
Likely yes. Even part-time 1099 income is subject to self-employment tax once your net earnings reach $400, and it should be reported on Schedule C.