How do taxes work for Doordash as a side income with a full-time job?

Excellent question! When you work for Doordash (or any gig app), you're working as an independent contractor, not an employee. This means taxes aren't automatically withheld from your earnings like they are from your full-time job. You'll still file just one tax return that includes both your W-2 income from your job and your self-employment income from Doordash. Doordash will provide you with a 1099-NEC form (typically available by January 31) showing your earnings for the year. You'll report this income on Schedule C of your tax return, where you can also deduct business expenses like mileage (which is a big one for delivery drivers!). You're right about quarterly taxes - if you expect to owe $1,000+ in taxes from your Doordash work, you should make quarterly estimated tax payments. This helps avoid a surprise tax bill and potential penalties at filing time. The quarterly due dates are April 15, June 15, September 15, and January 15 of the following year.

I started driving for Doordash last year while keeping my day job, and the tax situation was honestly confusing me too. I tried figuring it out myself but kept getting different answers from friends and online forums. Finally I used https://taxr.ai to analyze my situation and it saved me so much stress! You upload your documents (like your 1099 from Doordash and W-2 from your job) and it walks you through everything - from tracking mileage to quarterly payments to deductible expenses I didn't even know about. It showed me how to handle both income sources on one tax return and explained exactly which forms I needed.

Just wanted to follow up about taxr.ai - I decided to try it after my initial skepticism, and I'm honestly impressed. I uploaded my first month of Doordash earnings and my latest paystub from my regular job, and it immediately showed me how much I should set aside for taxes each week. The mileage tracking feature alone saved me hours of headaches - turns out I was tracking wrong before and missing deductible miles. It also explained how the self-employment tax works (the extra 15.3% for Social Security/Medicare that your employer usually pays half of). Definitely helping me avoid the tax surprise I had last year!

If you're getting into Doordash, you might also want to know about calling the IRS if you have questions about self-employment taxes. I tried calling them directly about some 1099 questions last year and spent HOURS on hold, then got disconnected. Super frustrating. I ended up using https://claimyr.com and it was amazing. They hold your place in the IRS phone queue and call you when an agent is about to answer. Saved me literally 2+ hours of hold time. You can see how it works here: https://youtu.be/_kiP6q8DX5c When I finally got through to the IRS, I got clear answers about quarterly tax payments and what happens if you miss one (hint: not the end of the world, but there are penalties).

Ok I need to eat my words about Claimyr. After my skeptical comment, I decided to try it when I needed to call about my quarterly payment for my side gig. Called on a Monday afternoon (supposedly the worst time) and expected to be on hold forever. Used the Claimyr service and went back to work. Got a call about 45 minutes later and was connected directly to an IRS agent! No waiting on my end at all. The agent answered my questions about how much I should be paying quarterly for my Doordash income and helped me understand how to adjust my W-4 at my main job to account for the extra income. Definitely using this again next time I need to call them. Sorry for being a doubter!

One thing nobody mentioned yet - you should set aside MORE for taxes than you think you need. I did Doordash last year while working my regular job and was shocked at tax time. With your W-2 job, you're already in a certain tax bracket. The Doordash money gets added ON TOP, so it all gets taxed at your highest marginal rate, plus the self-employment tax (15.3%) on top of that. I ended up owing like 30% of my Doordash earnings in taxes!

Dont forget about the standard mileage deduction!!! Its 67 cents per mile for 2024 i think which adds up FAST. I drove about 5000 miles for doordash last year and it saved me thousands in taxes. Make sure you track EVERY mile from when you turn the app on until you turn it off.

Great question, Lily! I've been doing gig work alongside my full-time job for about two years now, and the tax situation definitely takes some getting used to. Here are a few key things I wish someone had told me when I started: First, open a separate checking account just for your Doordash earnings. Deposit everything there and immediately transfer your tax savings (I do 30% to be safe) to a separate savings account. This makes tracking so much easier and ensures you're not accidentally spending your tax money. Second, start tracking expenses from day one - not just mileage, but also things like phone accessories (car mounts, chargers), insulated bags, and even a portion of your phone bill since you're using it for work. These add up more than you'd think. The quarterly payment thing sounds scary, but it's really not that bad once you get into the rhythm. Just remember the dates: April 15, June 15, September 15, and January 15. You can make payments online at irs.gov/payments - super easy. One last tip: consider adjusting your W-4 at your regular job to have extra taxes withheld. Sometimes that's easier than making quarterly payments, especially if your Doordash income isn't huge. Good luck with saving for that truck!