Instacart shoppers are generally independent contractors, not employees. Instacart does not usually withhold federal income tax, Social Security tax, or Medicare tax from your payouts. You are running a small delivery and shopping business, so you need to report your income, track business expenses, and save part of each payout for taxes.
Which tax form will Instacart send? If your payments meet the applicable reporting threshold, Instacart generally reports nonemployee compensation on Form 1099-NEC. For the 2026 tax year, look for that form by January 31, 2027, or the next business day if the deadline falls on a weekend or holiday. You may receive the form electronically in the Shopper app or from Instacart. Even if you do not receive a form, you still have to report all of your Instacart income.
A 1099-K can apply when payments are processed through a third-party payment network and meet the IRS reporting rules for that year. The 1099-K reports payment transactions, while a 1099-NEC reports nonemployee compensation, so the forms serve different purposes. Do not automatically add both forms together if they describe the same earnings. Compare the amounts with your Instacart payout history and keep records of any adjustments. Reporting thresholds and platform reporting practices can change, so check the instructions that arrive with your 2026 forms.
Your gross receipts are not the same as taxable profit. Start with the total Instacart paid you, including batch pay, promotions, tips, and other incentives. Then subtract ordinary and necessary business expenses to calculate net profit. That net profit generally flows to your personal tax return and is also used to calculate self-employment tax. Keep weekly payout statements, bank records, receipts, and a simple mileage log rather than trying to reconstruct everything in January.
Track the miles that actually qualify. For an Instacart shopper, business mileage can include driving from the store to a customer drop-off and then to another store or active shopping location. It can also include travel between stores when you are working. The trip from home to your first business destination and the trip from your last destination home are usually commuting miles, not business miles. Record the date, starting point, destination, business purpose, and miles. The mileage deduction calculator can help you estimate the value of those documented miles using the applicable 2026 rate.
Shopping time inside a store is different from driving time. You are paid for labor involved in finding and checking out groceries, but time spent walking aisles is not mileage and cannot create a mileage deduction. By contrast, driving between orders, stores, and drop-offs is the vehicle activity to track. This is an important difference from a driving-focused DoorDash or Uber schedule: Instacart combines in-store labor with transportation, so your records should separate the two. You cannot deduct the cost of your time, but you may deduct eligible business expenses connected to earning the income.
Common Instacart-related deductions may include insulated grocery bags or totes used for orders, subject to the normal business-use rules. You may also be able to deduct the business portion of your phone and data plan when you use the phone for batches, navigation, customer messages, and the shopper app. For example, if you reasonably document that 40% of your phone use supports Instacart work, that business percentage is more defensible than claiming the entire bill. Parking fees paid while shopping or completing a delivery can also qualify when they are ordinary, necessary, and documented. Keep the receipt and note the related order or store.
Vehicle costs require a method choice. The standard mileage method is often simpler for shoppers who have a reliable mileage log. If you use the actual-expense method instead, you generally track fuel, repairs, insurance, registration, and depreciation, then apply the business-use percentage. Do not claim the same vehicle costs twice by using actual expenses and the standard mileage rate for the same miles. A tax professional can help determine which method fits your records and vehicle.
Plan for quarterly payments. Because there is usually no withholding, set aside money whenever you are paid instead of waiting for tax season. Many shoppers use a separate savings account and transfer a percentage of net earnings after each week. If you expect to owe at least $1,000 for 2026 after withholding and refundable credits, estimated tax payments may be required. These payments generally cover both regular federal income tax and self-employment tax, which covers Social Security and Medicare contributions. State and local estimated payments may apply too.
Here is a rough monthly example for planning, not a tax return. Suppose you earn $3,000 from Instacart in one month and have $450 of documented business expenses, including mileage, parking, bags, and the business share of your phone bill. Your estimated net profit is $2,550. If you reserve 25% of that amount for 2026 federal income and self-employment taxes, the reserve is about $637.50, leaving roughly $1,912.50 available before state taxes and personal expenses. Your actual result will depend on filing status, other income, deductions, credits, and total-year profit. Update the estimate as your earnings change with the quarterly tax calculator.
Good records turn Instacart work into a predictable tax task. Save payout statements, photograph paper receipts, maintain a contemporaneous mileage log, and review your totals each month. The goal is to know your net profit and tax reserve before a quarterly deadline arrives, not to guess at the end of the 2026 tax year.
Related guides: DoorDash driver taxes and Uber driver taxes.