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If you drive for DoorDash, Uber, Lyft, Instacart, Amazon Flex, or similar apps, you’re almost always an independent contractor. No tax comes out of your payouts, and you owe self-employment tax plus income tax on your profit. The usual advice to “save 25–30%” often overshoots for drivers, because driving comes with one very large deduction: mileage.
In short: How much delivery and rideshare drivers should save for taxes in 2026, why mileage (72.5¢/76¢) matters most, and a worked example.
Why mileage changes the math
The IRS standard mileage rate for business driving in 2026 is 72.5¢ per mile from January 1 to June 30 and 76¢ per mile from July 1 to December 31, after a midyear increase. Delivery and rideshare drivers log a lot of miles, so this deduction can wipe out a large share of gross earnings on paper.
The standard rate is meant to cover gas, maintenance, insurance, depreciation, and the rest of your car costs. You deduct miles × rate instead of those actual costs. (Parking and tolls for business trips can be deducted on top.) You generally need to choose the standard mileage rate in the first year you use the car for business to keep that option later.
Worked example (2026)
A single driver earns $30,000 gross from apps in 2026 and drives 15,000 business miles, half in each half of the year. They have no other income.
| Step | Amount |
|---|---|
| Gross app earnings | $30,000 |
| Mileage: 7,500 × $0.725 + 7,500 × $0.76 | −$11,137.50 |
| Net profit (Schedule C) | $18,862.50 |
| Self-employment tax (15.3% × 92.35% of profit) | ≈ $2,665 |
| Federal income tax (after $16,100 standard deduction, half-SE deduction, QBI) | ≈ $114 |
| Total federal tax | ≈ $2,780 |
| As a share of gross earnings | ≈ 9.3% |
Without the mileage deduction, the same driver would owe roughly $5,180. That’s why keeping a mileage log matters more than almost anything else you do at tax time. To run your own miles, use the mileage deduction calculator.
Try the calculatorMileage Deduction Calculator (2026)Your 2026 business mileage deduction at 72.5¢, then 76¢ a mile, and roughly what it saves in tax.OpenA simple rule for what to save
Every driver’s mileage-to-earnings ratio is different, so here’s a way to set your own percentage:
- Track a normal week: gross payouts and business miles.
- Estimate profit = payouts − (miles × 76¢). Use 72.5¢ for miles driven before July 2026.
- Save about 15% of that profit for SE tax, plus 0–12% for federal income tax depending on your other income, plus your state rate if it has an income tax.
For many part-time drivers with no other job, that works out to 8–12% of gross. For drivers with a W-2 job, or who drive few miles relative to earnings (like high-tip delivery in a dense city), it can be 20%+ of gross, because your app profit stacks on top of your salary. Our set-aside percentage guide goes deeper, and you can plug your own profit into the 1099 tax calculator.
Where the miles come from
Business miles generally include driving to pickups, between orders, and on deliveries or rides while you’re working. Commuting from home to a regular workplace doesn’t count, though for app-based drivers whose home is the base of operations, many preparers count miles from the time you start working. The IRS expects a written or app-based record made at the time: date, miles, and purpose. Some apps show only “on-trip” miles, which can be far fewer than your actual business miles. A separate tracker usually captures more.
More detail is in our mileage deduction guide.
Other deductions drivers often miss
- The business share of your phone and phone plan
- Hot/cold bags, phone mounts, chargers
- Parking and tolls on business trips
- Platform fees, if your 1099 shows gross before fees
See freelance expense categories.
Forms and deadlines
- Apps may send a 1099-NEC (for 2026 payments, only if they paid you $2,000+) or a 1099-K (above $20,000 and 200 transactions). You owe tax on all earnings either way. See 2026 1099 thresholds.
- If you expect to owe $1,000 or more, pay quarterly estimated taxes. The last 2026 payment is due January 15, 2027. See 2026 due dates.
FAQ
How much should I save for taxes from DoorDash?
It depends mostly on your mileage. With a typical ratio of miles to earnings and no other job, many drivers owe roughly 8–12% of gross in federal tax. With a W-2 job or low mileage, it’s often 20% or more. Estimate your profit after mileage and save about 15% of it for SE tax plus your income tax rate.
What is the 2026 IRS mileage rate for gig drivers?
72.5 cents per business mile for January 1 – June 30, 2026, and 76 cents for July 1 – December 31, 2026.
Do I pay taxes on Uber or DoorDash income if I don’t get a 1099?
Yes. All earnings are taxable. Self-employment tax applies once your net earnings from self-employment are $400 or more.
Can I deduct gas and also take the mileage rate?
No. The standard mileage rate replaces actual car costs like gas, repairs, and insurance. Parking and tolls for business trips can be deducted separately.