As an independent contractor, how you decide to operate your business is up to you. Shipt doesn’t automatically withhold independent contractor earnings, and as an independent contractor, it’s your responsibility to file and pay your taxes.

You should aim to set aside 25-30% of each paycheck for self-employment taxes. Consulting a local tax professional about tax deductions, including which expenses can be written off* and how to track those expenses, can be very helpful and is recommended.
*Note: Shipt does not offer reimbursement for expenses incurred while delivering including, but not limited to, gas, parking fees, parking tickets, or tolls. Consult with a tax professional to see if those expenses can be written off on your taxes.

Helpful Information:

• Independent contractors are subject to paying the self-employment tax.
• In general, you’ll be required to file an income tax return if your net earnings from self-employment within a given tax year are $400 or more, and you can deduct certain expenses from your taxes. 
• If you have earned $600 or more on the Shipt platform within a given tax year, Shipt will provide you with a 1099-NEC at the end of the year in which you will report your income.
  *Note: The 1099-NEC is a new form for the 2020 tax year, replacing the 1099-MISC for independent contractors.
• You can use a mileage tracking tool to record your mileage during shops for tax purposes. 
  • Apps such as Everlance automatically detect mileage.

Tax Forms

At the end of each year, drivers will be prompted to confirm which delivery method they prefer their tax form be sent to — drivers may select either their email or physical mailing address.
*Note: Tax forms will not be issued to drivers who earned less than $600 with Shipt in the calendar year.

After the notification icon displays on the main menu, drivers will be able to follow the notification icon from their Account screen to the Tax Form Delivery screen to make their selection.

• If you do not make a selection in the app, it will default to physical mail delivery and you will receive your form in the mail. However, we encourage selecting e-delivery as it is an eco-friendly and faster option.
• You can change your selection at any time, but changes made after January 20th may not go into effect until the following tax year.
• If you select e-delivery, the forms will be provided in PDF format. You will be able to access the file using Adobe Acrobat Viewer or other free PDF viewing software.
• If you’d like to also receive a paper copy after selecting e-delivery please reach out to Shipt Support.
• If you need to update your mailing address, you can do so from the Account screen in the app. If you need to update your email, please reach out to Shipt Support.

Additional Resources:

• IRS: Self-Employed Individuals Tax Center
• IRS: Self-Employment Tax
• Everlance: Taxes for Self-Employed Individuals
• Everlance: The Self-Employment Tax