Door Dash mileage credit

[SAL9965]

Seems like if your income is lower than the standard deduction amount, there is no need to track mileage from Door Dash.  Is that accurate?

[MinhT1]

This is not true.

If you have a business, you have to deduct all allowable expenses.

Also if you do not deduct expenses like mileage, you will have to pay self-employment tax of 15.3% on the total income, instead of on the net income after deduction of expenses, even if your total income is less than the standard deduction.

[SAL9965]

Thanks for the info.  I guess in turbotax if doesn't appear that the taxable income is reduced - its indicating the reported DD earnings x .9235 on schedule SE and then calculating the tax owed of 12.4% + 2.9%.  There is no reduction of this tax amount owed for the standard deduction or mileage expense.  Perhaps I have entered something incorrectly.

[MinhT1 · Accepted solution]

The self-employment tax is calculated at 15.3% of 92.35% of your net income.

When you deduct mileage and other expenses, this reduces your income and should result in a lower self-emplyment tax. The standard deduction will only reduce your taxable income, in your case to 0 and you do not have income tax tax to pay.

Self-employment tax is separate from income tax and is not reduced by the standard deduction.

[SAL9965]

thanks so much for your quick response and insights