Gig Worker Taxes Don't Have to be Scary
Keep more of what you earn. The ultimate 2026 guide to 1099 taxes, deductions, and staying out of trouble with the IRS.
1. The Self-Employment Tax (15.3%)
Unlike regular W-2 jobs where the employer splits Medicare and Social Security taxes, as an independent contractor (1099), you pay the full amount. This is known as the Self-Employment (SE) tax.
- Social Security: 12.4%
- Medicare: 2.9%
- Total rate: 15.3%, generally applied to 92.35% of net earnings, subject to individual limits
2. The Magic Eraser: The Standard Mileage Deduction
If you made $10,000 driving for Uber, you do not simply pay 15.3% on $10,000. Eligible business deductions reduce net earnings, and the federal self-employment-tax calculation generally applies the 15.3% rate to 92.35% of that amount. Income tax is separate.
For many drivers, the standard mileage method is the simplest deduction method. The 2026 business rate is 76¢ per mile from July 1 and was 72.5¢ from January through June (Official IRS Source). Our current calculator uses 76¢ as a planning proxy, not tax advice.
Example:
At the current 76¢ rate, 10,000 qualifying business miles would produce a $7,600 mileage deduction. Actual tax treatment depends on when the miles were driven and your eligibility.
⚠️ Warning: If you claim the standard mileage rate, you cannot also deduct gas, repairs, or depreciation. The rate covers all of that.
3. Estimated Quarterly Payments
Because Uber and DoorDash don't withhold taxes from your paycheck, the IRS expects you to pay as you go. If you expect to owe more than $1,000 in taxes for the year, you must make Estimated Quarterly Payments.
If you wait until April to pay your entire tax bill, you'll be hit with an underpayment penalty.
Need the tax and mileage setup?
Taxes are one lane of the system. Start with a simple reserve routine and a mileage stack you can actually keep using.