Table of Contents

Does DoorDash Give You a 1099? Your Gig Economy Tax Guide

Yes, DoorDash does provide its delivery drivers (Dashers) with a 1099-NEC form if they earn $600 or more in a calendar year. This form is crucial for filing your taxes as an independent contractor, detailing the income you received from DoorDash during the tax year. Now, let’s dive deeper into the nuances of this 1099 and what it means for your tax obligations.

Understanding the 1099-NEC Form

The 1099-NEC (Nonemployee Compensation) form is the key document you’ll need to report your DoorDash earnings to the IRS. Prior to 2020, this information was included on the 1099-MISC. But the IRS brought back the 1099-NEC to specifically track income paid to independent contractors.

What Information is on the 1099-NEC?

The 1099-NEC will show:

Your personal information: Name, address, and Taxpayer Identification Number (TIN), which is usually your Social Security Number (SSN) or Employer Identification Number (EIN) if you operate as a business.
DoorDash’s information: Name, address, and Employer Identification Number (EIN).
The amount of money DoorDash paid you during the tax year (Box 1, “Nonemployee Compensation”). This includes your earnings from deliveries.

How Will I Receive My 1099-NEC from DoorDash?

DoorDash typically provides your 1099-NEC electronically through the Dasher app or website. You will usually receive an email notification when it is available for download. Make sure your email address is current in the app to avoid delays. In some cases, if you haven’t consented to electronic delivery, DoorDash might mail a physical copy to the address they have on file.

The Implications of Being an Independent Contractor

As a Dasher, you’re classified as an independent contractor, not an employee. This distinction is vital for tax purposes. It means you’re responsible for:

Paying your own self-employment taxes: This includes Social Security and Medicare taxes, which are usually split between the employer and employee but are solely your responsibility as a contractor.
Tracking your income and expenses: Keeping accurate records is crucial for calculating your taxable income and claiming eligible deductions.
Potentially making estimated tax payments: If you expect to owe $1,000 or more in taxes, you might need to make quarterly estimated tax payments to the IRS to avoid penalties.

Tracking Your Income and Expenses

DoorDash will provide you with the total amount they paid you. However, you need to keep track of your expenses. Good record keeping is critical. Use a spreadsheet, accounting software, or even a dedicated app to log all your income and deductible expenses related to your DoorDash business.

Common Deductible Expenses for Dashers

One of the biggest advantages of being an independent contractor is the ability to deduct business-related expenses, which can significantly reduce your tax liability. Some common deductible expenses for Dashers include:

Mileage: The standard mileage rate set by the IRS for business use of your car is a significant deduction. Keep a detailed log of your miles driven for DoorDash deliveries. Remember to only count miles driven while dashing, not your commute to your first delivery area or home from your last.
Car Expenses: Instead of the standard mileage rate, you can deduct actual car expenses. This includes gas, oil changes, repairs, insurance, registration fees, and depreciation. You’ll need to choose either the standard mileage rate or actual expenses, and stick with that method for the entire year. Choosing the standard mileage rate is generally simpler, and often results in a larger deduction.
Cell Phone: The portion of your cell phone bill attributable to your DoorDash business is deductible.
Cell Phone Accessories: Items like phone mounts and chargers used primarily for dashing are also deductible.
Hot Bags and Delivery Equipment: The cost of insulated bags and other tools you use to maintain food quality during deliveries is deductible.
Health Insurance Premiums: Self-employed individuals may be able to deduct health insurance premiums.
Tax Preparation Fees: The fees you pay for tax preparation software or services are also deductible.

Important Note: You can only deduct expenses that are “ordinary and necessary” for your business. It’s best to consult with a tax professional to ensure you’re claiming all eligible deductions correctly.

DoorDash and State Taxes

Don’t forget about state income taxes. In addition to federal income tax, you’ll likely need to pay state income tax on your DoorDash earnings, depending on the state where you live and work. The same principles apply to state taxes as federal taxes – you’ll need to report your income and can deduct eligible business expenses.

When Should I Expect My 1099-NEC?

DoorDash is required to provide you with your 1099-NEC by January 31st of the following year. So, for example, your 1099-NEC for the 2024 tax year should be available by January 31st, 2025. This gives you ample time to prepare your taxes before the filing deadline, typically in mid-April (unless an extension is granted).

What If I Didn’t Receive a 1099-NEC?

If you earned $600 or more from DoorDash in a tax year and haven’t received your 1099-NEC by early February, there are several steps you can take:

Check your DoorDash account: Log into the Dasher app or website and look for a section related to tax documents. Your 1099-NEC might be available for download there.
Contact DoorDash support: Reach out to DoorDash support to inquire about your 1099-NEC. They can help you track it down or issue a new one.
Request a transcript from the IRS: If you can’t obtain your 1099-NEC from DoorDash, you can request a wage and income transcript from the IRS. This transcript will show the income reported to the IRS under your Social Security number.

Even if you don’t receive a 1099-NEC, you are still legally obligated to report all income you earned from DoorDash on your tax return.

FAQs About DoorDash and 1099s

Here are some frequently asked questions about DoorDash and 1099 forms:

1. What happens if I made less than $600 with DoorDash?

If you earned less than $600 from DoorDash in a tax year, they are not required to send you a 1099-NEC. However, you are still legally obligated to report all income you earned, regardless of whether you received a 1099. Keep track of your earnings, even if they are below the $600 threshold.

2. Can I claim deductions even if I didn’t receive a 1099-NEC?

Yes! You can claim all eligible business deductions, even if you didn’t receive a 1099-NEC. Remember, your tax obligation is based on your actual income, not just what’s reported on a form.

3. What if my 1099-NEC is incorrect?

If you believe the information on your 1099-NEC is incorrect (e.g., the income amount is wrong), contact DoorDash support immediately. They can investigate the issue and issue a corrected 1099-NEC if necessary.

4. Do I need to pay both state and federal taxes?

In most cases, yes. Unless you live in a state with no state income tax, you’ll likely need to pay both federal and state income taxes on your DoorDash earnings.

5. What is the difference between the standard mileage rate and actual car expenses?

The standard mileage rate is a simplified method of calculating your car expenses by multiplying the number of business miles driven by a rate set by the IRS. Actual car expenses involve tracking and deducting the actual costs of operating your vehicle, such as gas, oil changes, repairs, insurance, and depreciation. You can only choose one method and must stick with it for the entire year. The standard mileage rate is generally simpler, and often results in a higher deduction.

6. What records should I keep for tax purposes?

Keep meticulous records of your:

Income: Track all payments received from DoorDash.
Mileage: Maintain a detailed mileage log.
Expenses: Keep receipts for all deductible business expenses.
Payment Summaries: Download and save earnings summaries from the DoorDash app.

7. Can I deduct the cost of meals I buy while Dashing?

Generally, no. Meals are usually considered a personal expense. The exception is if you are traveling away from your tax home overnight for business, in which case you might be able to deduct 50% of the cost of meals. However, this scenario is rare for DoorDash drivers.

8. Should I make estimated tax payments?

If you expect to owe $1,000 or more in taxes, you should consider making quarterly estimated tax payments to the IRS. This can help you avoid penalties for underpayment of taxes.

9. Where can I find my 1099-NEC in the DoorDash app?

The location can vary slightly depending on the app version, but generally, you can find your 1099-NEC in the “Earnings” or “Tax Information” section of the Dasher app.

10. What if I don’t file my taxes on time?

Filing your taxes late can result in penalties and interest charges. If you can’t file on time, you can request an extension, which gives you additional time to file your return.

11. Can I write off clothes I bought for dashing?

Generally, no. You cannot deduct the cost of clothing unless it is required for the job and not suitable for everyday wear. For example, if DoorDash required all dashers to wear a specific branded uniform, that uniform would be deductible. Otherwise, regular clothing is considered a personal expense, even if you only wear it when working.

12. Is my DasherDirect card income considered taxable?

Yes. Income deposited into your DasherDirect card is still taxable income. The 1099-NEC will reflect the total amount paid to you, regardless of how it was received.

Disclaimer: I am an AI chatbot and cannot provide tax or financial advice. This information is for general guidance only. Consult with a qualified tax professional for personalized advice based on your specific circumstances. They can help you navigate the complexities of self-employment taxes and ensure you’re complying with all applicable laws and regulations. Driving for DoorDash can be a great way to earn income, but it’s crucial to understand your tax obligations and manage your finances responsibly.