Question 1

Track every business mile

Accepted Answer

The biggest deduction most gig drivers get The IRS pays you per business mile: 70 cents in 2025, 72.5 cents in 2026. At 18,000 business miles, that's $12,600 you can write off in 2025, or $13,050 in 2026.

Question 2

Save 25 to 30 percent of every payout

Accepted Answer

You owe both self-employment tax and regular income tax. Plan for both. Self-employment tax is 15.3 percent of your profit (12.4 percent Social Security plus 2.9 percent Medicare). Federal income tax adds another 10 to 24 percent on top. California adds 1 to 9.3 percent for most gig drivers.

Question 3

File Schedule C if you net 400 dollars or more

Accepted Answer

Threshold is low. You file with or without a 1099. Schedule C is the IRS form for self-employed income. Schedule SE is for the Social Security and Medicare tax on it. Both attach to your regular Form 1040. The $400 threshold has been the law since 1990.

Question 4

Cash tips count as income

Accepted Answer

Every dollar goes on Schedule C line 1, with or without a 1099 Platforms report what they paid you on a 1099-NEC. Cash tips are separate. Add cash tips to your platform income before filing.

Question 5

Pay quarterly when you expect to owe 1000 dollars or more

Accepted Answer

Four due dates a year, not evenly spaced. Pay via Form 1040-ES. For tax year 2026: April 15 (Q1, already past). June 16 (Q2). September 15 (Q3). January 15, 2027 (Q4). Pay at irs.gov/payments using IRS Direct Pay.

Question 6

Half of self employment tax is deductible

Accepted Answer

The IRS lets you deduct half of your self-employment tax. Self-employment tax has two halves. When you're a W-2 worker, your employer pays one half. As a gig worker, you pay both, but the IRS lets you deduct that 'employer half' against your income tax. On $33,000 of net profit, your SE tax is $4,663 and the deduction is $2,332.

Question 7

Home office only counts when use is regular and exclusive

Accepted Answer

Most rideshare and delivery drivers do not qualify The space has to be used only for work. It cannot also be a guest room, kitchen, or family space. $5 per square foot, up to 300 square feet. Same in 2025 and 2026.

Question 8

Year one mileage choice locks the vehicle in

Accepted Answer

Pick standard mileage in year one or never get it on that car again Standard mileage is one number per mile. It covers gas, repairs, insurance, maintenance, and depreciation, all bundled. The alternative is 'actual': you save every gas receipt, every oil change, every repair, and depreciate the car over six years. Hard to do, and only a bigger deduction for expensive new cars.

Question 9

Section 179 lets you fully expense business gear in year one

Accepted Answer

Up to $1.25M in 2025; up to $2.5M in 2026 after OBBBA. Phone, laptop, dash cam, hot bag. The gear has to be used more than half the time for your gig work. The dollar limits are huge ($3.13M in 2025, $4M in 2026), so this never bites solo drivers. You claim Section 179 on Form 4562 with your return.

Question 10

OBBBA brought back 100 percent bonus depreciation

Accepted Answer

Vehicles and equipment placed in service after January 19 2025 get full year-one write-off Before July 4, 2025, bonus depreciation was shrinking each year: 60 percent in 2024, 40 percent in 2025. OBBBA (the bill Congress passed on July 4, 2025) made 100 percent bonus permanent for anything placed in service after January 19, 2025.

Question 11

A 1099-NEC over 600 dollars triggers self employment tax

Accepted Answer

If you earned $600+ from any one platform, you'll get a 1099 and owe self-employment tax. Each platform sends you its own 1099-NEC. Add up all of them as your gross income on Schedule C. After expenses, what's left becomes your self-employment income on Schedule SE.

11 tax rules every 1099 worker should know.