Grubhub provides a secondary source of income that you could use to supplement your main one. It could also be a primary source if you have enough time to devote to it.
However, you’re required to pay taxes on your income, so we looked into how Grubhub handles taxes, and here’s what we found!
Does Grubhub Take Out Taxes In 2023?
Grubhub doesn’t take out taxes either at the local, state, or federal levels, because it classifies drivers as independent contractors in 2023. This means that Grubhub drivers are responsible for paying their own taxes; Grubhub only lets them know how much they were paid. For their taxes, Grubhub gives drivers 1099s instead of W-2s because they are not considered employees.
Keep reading to learn everything you need to know about how Grubhub does taxes, including the forms you’re given, write-offs, and more!
Does Grubhub Give You a W-2?
Grubhub does not give you a W-2 because it considers drivers to be independent contractors, so this form wouldn’t fit this working relationship.
A Form W-2 is given by an employer to their employee showing how much they’ve earned, and how much has been withheld in taxes and other benefits.
Grubhub doesn’t withhold taxes from your income and doesn’t offer any benefits so the company doesn’t issue W-2s.
Will Grubhub Send Me a 1099 Form?
Grubhub will send you a 1099 form that includes how much money you earned from the platform in a calendar year.
An 1099 is issued to independent contractors who are also defined by law as self-employed, so those who receive it are required to calculate how much they owe on their own.
You will only get a 1099 from Grubhub if you earned $600 or more from January 1st to December 31st.
Grubhub calculates your taxable income on the 1099, depending on the dates when you received payment.
This means that, for example, if you accepted an order and delivered it on December 31st, but got paid when it was already January, the payment won’t be included in that year’s 1099.
How much money you’ve earned will be indicated towards the top of the form in a section marked “Box 1: Non-Employee Compensation.”
Since 2020, the IRS has been using the 1099-NEC instead of 1099-MISC because it’s the one with information for independent contractors, and this is what Grubhub issues to its drivers.
Depending on how you’ve set up your account, you could receive an 1099 from Grubhub either in your email or by physical mail.
How Is Grubhub Taxed?
Grubhub doesn’t withhold taxes from its drivers. Instead, the company calculates how much it earned in a calendar year (Jan 1 to Dec 31) and indicates that in a 1099 to the driver.
When the driver receives this form, they’re supposed to do their taxes as usual: calculate how much they owe the IRS for that year, make adjustments for write-offs, then pay that amount.
Grubhub only issues 1099s to drivers who made $600 or more and sends a copy of the form to the IRS.
If you made less than $600, you’ll still have to file your tax return, but Grubhub won’t send you the 1099 because they’re not legally required to do so for amounts below this threshold.
Can Delivery Drivers Write off Gas?
Grubhub drivers can write off gas when filing their taxes because it’s considered a business expense.
However, you can only write off gas you used when actively working (driving to restaurants, making deliveries, etc.) and that you have receipts for so you can prove the exact amounts you spent.
What Can I Write off for Grubhub?
You can write off most of the things you spend money on when actively working for Grubhub when filing your taxes – you just have to have the receipts.
With this in mind, most Grubhub drivers can write off the following:
- Vehicle repair costs
- Parking fees
In some cases, you could also write off part of your car note and insurance for the vehicle you use to make deliveries.
If you don’t use a car for Grubhub, you could also write off the following:
- A portion of your phone bill for what you use to contact customers
- Your delivery compartment (ex. a cooler if you bought one for the job that year)
- Your delivery vehicle like a bicycle or scooter if you bought it specifically for Grubhub that year
In theory, you could write off nearly anything that you spend money on for the job if you saved the receipts.
If you’re not sure whether or not something qualifies as a business expense, you could consult a tax expert for advice.
Grubhub does not take out taxes because it considers drivers to be independent contractors. For this reason, GrubHub sends 1099s to the ones that made $600 or more that year because that’s the minimum amount the company is required to disclose.
If you made less than $600 from Grubhub, you’ll still need to file your taxes, but you won’t be sent an 1099. Grubhub does not issue W-2s because it doesn’t classify drivers as employees, so they would need to file taxes on their own.