Earning money by delivering orders for DoorDash is a simple way to earn extra cash, and you get to choose your work hours! But as the tax deadline rolls around, you might be curious about reporting your DoorDash earnings.
For example, you might be asking, does DoorDash automatically take taxes out of my annual earnings? I wondered about the same thing, so I decided to look into it a little more in-depth. Here’s everything I discovered!
Does DoorDash Take Taxes Out In 2023?
DoorDash does not automatically withhold taxes from your paycheck as of 2023. Because you work as an independent contractor when you deliver for DoorDash, you are responsible for keeping track of your earnings. Still, DoorDash’s partner, Stripe, sends you a 1099-NEC form via email or regular mail if you earn $600 or more during the year.
If you want to learn more about DoorDash taxes, what a 1099-NEC form is, how you receive your tax information, and much more, then keep reading! I’ve researched everything you need to know!
Does DoorDash Automatically Take Taxes Out Of Your Paycheck?
No, DoorDash does not automatically withhold taxes from your paycheck.
Because you are working as an independent contractor when you drive for DoorDash, you are responsible for keeping track of your taxes.
Fortunately, DoorDash helps make the process a little easier by providing you with an earnings report and a tax form.
Does DoorDash Send You Tax Forms?
Yes, DoorDash sends you one tax form called a 1099-NEC form, but DoorDash only sends you this form if you earn $600 or more during the year.
With that, DoorDashers should receive the 1099-NEC form via email from a third-party company called Stripe.
However, you must set up an account with Stripe in order to receive your tax documents.
Also, if you do not see the tax form in your email by mid-January, make sure you check your spam and junk folders, as sometimes the message is sent there.
Further, to make finding the email more straightforward, the message is entitled “Confirm your tax information with DoorDash.”
What Is A 1099-NEC Form?
A 1099-NEC tax form contains federal income tax information that you use to report annual earnings and proceeds that are different from wages, salaries, and tips.
Then, 1099-NEC reports are filed with the US Internal Revenue Service and, if applicable, state tax departments as well.
Essentially, a 1099-NEC form provides DoorDashers with a summary of their earnings as independent contractors, which they will need to file their taxes.
Again, DoorDash only sends 1099-NEC documents to delivery drivers that earn $600 or more during the year.
How Do You Download Your DoorDash 1099-NEC Form?
As previously mentioned, DoorDasher’s receive their 1099-NEC forms from a third-party company called Stripe.
That said, after you create a Stripe account, you have the option to receive your tax forms via email or regular mail.
According to DoorDashers, email is a much more efficient way to obtain the form, and it’s the fastest delivery method.
So, after you receive an email from Stripe containing your 1099-NEC form, all you have to do is download it to your computer.
On the other hand, if you choose to receive a paper copy, you will need to wait about ten business days from the end of January (when the email forms are sent) to get your 1099-NEC form.
Can You Write DoorDash Expenses Off On Your Taxes?
Yes, one of the benefits of working as an independent contractor through DoorDash is that you are allowed to deduct several business expenses (see below).
That said, the more tax deductions you report, the less money you will be required to pay in taxes.
Therefore, it’s essential to keep a detailed record of all the expenses you incur while DoorDashing.
What DoorDash Expenses Can You Write Off?
As previously mentioned, there are several DoorDash-related expenses you are allowed to write off on your taxes. For example, here are some of the things you can deduct from your taxes:
- Mileage (but you cannot deduct mileage and gas at the same time)
- Phone and phone service
- Phone accessories (car holder, car charger)
- Hot bags
- Courier backpacks
- Parking expenses
- Roadside assistance
- Vehicle inspections
- Health insurance
However, you can only deduct expenses as a percentage of business use.
So, you cannot deduct all your car mileage from your taxes, only the amount that occurred while on DoorDash deliveries.
How Do You Check Your DoorDash Earnings?
Fortunately, you do not need to calculate your DoorDash earnings by yourself. Instead, your annual earnings are clearly indicated on the 1099-NEC form you receive in the mail.
But, you can still estimate your DoorDash earnings before receiving your 1099-NEC form if you wish.
That said, DoorDashers can view their earnings by logging into their Stripe Express and Payfare accounts (if they deposited payments with DasherDirect).
However, it’s important to note that any reimbursements (if you pay for a DoorDash order with cash) are not included in the 1099-NEC earnings because they are not taxable.
DoorDash does not automatically withhold taxes from your annual earnings because you work as an independent contractor when you deliver for the company.
Instead, DoorDash’s third-party business partner, Stripe, sends you a 1099-NEC form, which contains all the information you need when filing your taxes.
However, you only receive a 1099-NEC form if you earn $600 or more during the year.