If you drove for Uber, delivered for DoorDash, or sold crafts on Etsy last year, a tax form is headed your way — and it may not match what actually landed in your bank account.
Here's the catch that trips up millions of gig workers: your 1099 form reports gross earnings, before the apps took their cut.
That means a driver who saw $30,000 hit their account might get a form showing $42,000 in income.
Commissions, service fees, and tips processed through the platform.
The IRS taxes you on that bigger number first.
The fix is the mileage deduction, and it's the single biggest money-saver for anyone who drives.
For the 2024 tax year, the standard mileage rate is 67 cents per mile.
Put 20,000 work miles on your car and that's a $13,400 deduction — enough to wipe out a big chunk of that phantom income.
Reconstructing it in April from your oil change receipts does not, and auditors know it.
Delivery workers have it harder than rideshare drivers.
DoorDash and similar apps often don't tell you the customer's address until you accept the order, so tracking is messy and mileage tends to get undercounted.
Some drivers report eating thousands of dollars in deductions simply because they never logged the miles.
Then there's the quarterly payment problem.
If you owed $4,000 last April and paid it all at once, you likely owe a penalty on top — the IRS wants its money in installments, roughly every three months.
First-quarter 2025 payments were due April 15.
The good news: the standard deduction still applies, and new this year, some gig workers can deduct a portion of their health insurance premiums and retirement contributions.
A solo 401(k) or SEP IRA lets you shelter a meaningful slice of earnings while cutting your tax bill.
What to do right now, in order: First, find every 1099 in your inbox, your app dashboards, and your mailbox — they're due to you by January 31, but stragglers are common.
Second, total your miles any way you can, even approximately, and compare it to the standard deduction versus actual expenses like gas, repairs, and insurance.
Third, if you owe, look into an IRS payment plan before the deadline; the fees are far smaller than the penalties for ignoring the notice.
One more thing worth knowing: if gig work was a side hustle and you also had a W-2 job, your withholding probably covered less than you think.
The gig income stacks on top, taxed at your marginal rate. **The bottom line:** Gig platforms make earning easy and bookkeeping invisible, which is exactly why so many workers overpay every spring.
Twenty minutes with a mileage log and a calculator can be worth more than a full day of driving.
Final Thoughts
Treat the tax paperwork as part of the job — because the IRS certainly does.