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The Ultimate Tax Guide
The Ultimate Tax Guide for Grubhub drivers
Grubhub drivers save thousands with this tax guide
An Information and Tax Guide for Grubhub drivers
1099 delivery drivers save thousands with this tax guide
Learn all about delivery driver taxes
List of all possible deductions
Tools to automate your taxes
Everything You Need to Know About Grubhub and Taxes
The pandemic has changed the food scene as we know it. Now more than ever, people are opting for food delivery companies like Instacart, Doordash, Postmates and GrubHub to get their groceries and take-out food. Working as a delivery driver has some great perks, too, like setting your own hours and deciding which deliveries you want to make.
You’re your own boss and can set up your own work schedule. But the title of boss comes with many responsibilities. It’s now on you to report any income you earn and pay taxes on your earnings. We’ll take you through everything you need to know about navigating and paying GrubHub taxes.
Table of contents
Do you have to pay taxes working for Grubhub?...Read more
Does GrubHub withhold my taxes?...Read more
How much do GrubHub drivers make?...Read more
Important GrubHub tax forms...Read more
How to get a 1099 from GrubHub...Read more
GrubHub 1099 forms...Read more
Schedule C...Read more
Schedule SE...Read more
Quarterly taxes and estimated payments...Read more
GrubHub tax deductions...Read more
Do you have to pay taxes working for Grubhub?
You’re not considered an actual employee when you work as a delivery driver for GrubHub. The IRS classifies you as an independent contractor and you’re responsible for filing your own taxes. In addition to paying federal and state taxes, you will also have to pay self-employment taxes. Most food delivery companies operate similarly.
Does GrubHub withhold my taxes?
Your taxes are withheld with each paycheck when you’re on a company’s payroll. But things are different for freelance food delivery drivers. You’re fully responsible for reporting your income and paying taxes as your taxes aren’t withheld by an employer.
As you’re both the employer and the employee, you’re solely responsible for paying the whole 15.3% of the self-employment taxes. This tax rate is broken down into 12.4% for Social Security taxes and 2.9% for Medicare taxes.
So to answer the question, how much do GrubHub drivers pay in taxes? You’ll pay 15.3% self-employment taxes, and you’ll pay federal income taxes on the income you make driving for GrubHub.
How much do GrubHub drivers make?
When it comes to answering the question “How much does GrubHub pay?” There are a few factors that determine how much you’re paid. GrubHub compensates drivers for the amount of time they spend on the road. Sometimes food delivery couriers might be sitting in traffic, behind a slow driver or stuck at a railroad crossing, which impacts the amount of time on the road.
There is compensation for the number of miles driven per order. GrubHub drivers get to keep 100% of their tips. GrubHub also provides incentives, like special offers for completing missions. Each factor determines how much a GrubHub driver makes.
Important GrubHub tax forms
Since you’re now in charge of filing your own taxes, it’s up to you to understand which GrubHub driver tax forms you’re responsible for filing and which forms will come in the mail.
How to get a 1099 from GrubHub
You might be asking the question “How do I get my 1099 from GrubHub?” The simple answer is you will automatically receive a GrubHub 1099 form by the end of January if you made $600 or more in GrubHub income. The IRS also receives a copy of this form from GrubHub. You can get the GrubHub 1099 form online, or you can choose to receive it by mail.
GrubHub 1099 forms
With the start of the 2020 tax year, the IRS made some changes to the 1099-MISC. With the new changes, you’ll report any self-employment income on Form 1099-NEC instead of reporting it on Form 1099-MISC. So if you made $600 or more working for GrubHub, you’ll need to file a GrubHub 1099-NEC.
If you had any payments processed through a "third-party settlement organization" including credit card or payment apps you might get a 1099-K form from GrubHub. Drivers will receive a 1099-K instead of a 1099-NEC if they earned at least $20,000 from GrubHub and completed a minimum of $200 deliveries. Initially, the IRS intended to lower the 1099-K threshold to $600 by 2022, aligning it with the requirements for 1099-NECs. However, this change was postponed until 2024.
However, receiving a GrubHub 1099 form depends on the date the payment was issued and not the date that the order was placed or fulfilled. So, if you have a fulfilled order before the end of the tax year, but didn’t receive the payment until after the start of the new tax year, the payment will be reflected on next year’s 1099 GrubHub form.
Schedule C
Anyone self-employed needs to fill out Schedule C, which reports the business profits and losses. Here’s where the information from your 1099 comes in handy. You’ll need to fill out Schedule C to report your income from GrubHub and you’ll use it to figure out your total amount of taxable income after writing off your business deductions.
Schedule SE
Schedule SE is the form you’ll use to calculate how much self-employment tax you’ll owe the IRS. The self-employment tax includes both the Social Security tax and the Medicare tax and is paid by any taxpayer making over $400 in self-employed income.
Quarterly taxes and estimated payments
You’ll need to file estimated quarterly taxes if you make $1,000 or more working for GrubHub. After estimating what you owe for the year, you'll need to make estimated tax payments in four installments throughout the year. The dates for the estimated payments are April 15, June 15 and September 15 and January 15 of the following year.
Failing to meet these deadlines can result in penalties and interest from the IRS. In some extreme cases, it can also trigger an audit, which everyone wants to avoid. You can always ask a tax pro to help if you’re new to paying estimated taxes.
GrubHub tax deductions
You’ll need to file estimated quarterly taxes if you make $1,000 or more working for GrubHub. After estimating what you owe for the year, you'll need to make estimated tax payments in four installments throughout the year. The dates for the estimated payments are April 15, June 15 and September 15 and January 15 of the following year.
Failing to meet these deadlines can result in penalties and interest from the IRS. In some extreme cases, it can also trigger an audit, which everyone wants to avoid. You can always ask a tax pro to help if you’re new to paying estimated taxes.
One way to save money on your taxes is by making business tax deductions. There are some great deductions for delivery drivers that you can claim on your tax return.
Since a car is necessary for your gig, you can write off the miles you drive. You have two options when it comes to making the mileage deduction.
Standard mileage method: You can take a deduction for the number of miles you drive and multiply it by the IRS mileage rate to get the deduction amount. For the 2023 tax year, it’s 65.5 cents per mile. You can deduct parking fees and tolls with this option, but you can’t deduct any other car-related expenses.
Actual expenses method: If you take this route, you’ll need to keep track of the miles you drive and any vehicle-related expenses, so don’t throw those receipts away. With this option, you can claim expenses like insurance, maintenance and repairs, car depreciation and registration fees. After adding up your vehicle-related expenses for the tax year, multiply the amount by the percentage that your car is used for business.
It’s best to use a car mileage tax calculator to help you figure out how much to deduct.
There are also some other business tax deductions you can make to help save on taxes. It’s pretty important to have a cell phone when driving for GrubHub. You can deduct the costs of using a cell phone for business purposes. So if you use your cell phone for business 50% of the time, you can only deduct 50% of the bill.
Or, to make things simpler, buying a cell phone and using it solely for your delivery driver gig is best. You can deduct the total cost of the phone, your monthly bill and any phone accessories you might need, like a car charger or stand.
Customers expect their food to arrive either hot or cold, depending on the item. If you need to purchase any equipment to keep the food hot or cold, you can deduct those expenses. This includes any hot bags, coolers or courier backpacks.
What’s FlyFin?
FlyFin is an app specifically designed to help self-employed individuals with their taxes. Whether you’re a gig worker, freelancer, small business owner or independent contractor, A.I. scans your expenses and finds every business deduction you can use to lower your tax bill. Expert CPAs can prepare and file your returns, along with providing unlimited tax support. FlyFin also offers free audit insurance. Make your tax season a breeze with FlyFin!
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