Congrats on joining the gig economy and planning to file with self employment income for the first time! A little planning in this area can go a long way to help you avoid an unexpected bill at tax time. The first year is the toughest one to plan for - you don't know how much you'll make when you start, and you are learning about what your business expenses are as you go. Tough does not mean impossible!
UberEats and DoorDash will issue you a 1099-NEC that documents everything they paid to you for the year. That is your starting point for taxes. Keeping careful track of all the expenses related to producing that income will help you reduce your tax liability when you file.
There are two really big expense areas that apply to most delivery drivers - one is going to be your platform fees, and DoorDash will provide you with a summary at the end of the year that does tell you the total amount you paid in fees. The second area is the harder one - vehicle expenses. If you are riding a bicycle in a big city, this likely doesn't apply to you, however, if you are like the vast majority of drivers, you are driving your car to and from local restaurants in order to collect the orders and delivering them to your customers. The miles you drive while working need to be tracked so you can claim either the business percentage of your actual vehicle expenses or the standard mileage deduction.
Once you know what your net income is (the gross earnings less your expenses) you can use that information to figure out how much tax you will owe. You can keep track of this roughly during the year and as you get to the end of each month keep an eye on your profit for the month. You will use those earnings to make your best estimate of what your tax liability is for the income. Estimates are not exact and you don't have to be perfect - the goal is to make sure you are close to what you actually owe. When you file the return if you didn't pay enough, you'll owe it by the tax deadline. If you paid too much, you get the money back as part of your refund
The actual estimated payments are due 4 times during the year - but they do not fall exactly 3 months apart.
| Payment Period |
Due Date |
| January 1 – March 31 |
April 15 |
| April 1 – May 31 |
June 15 |
| June 1 – August 31 |
September 15 |
| September 1 – December 31 |
January 15* of the following year. |
Clarissa
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