Many workers are turning to delivery services such as DoorDash and Uber Eats. Some of these workers use the services for their full-time income, while others use it as supplemental income.
Either way, the question arises of whether or not DoorDash drivers are self-employed or not.
Table of Contents
- Are DoorDash Drivers Self-Employed?
- What’s the Difference Between Employees and Nonemployees?
- Where Do I Find My Form 1099?
- Can I Write Off Any Expenses?
- What Happens If I Don’t File My Taxes?
- Do DoorDash Drivers Set Their Own Hours?
- Are Dashers Considered Self-Employed?
Are DoorDash Drivers Self-Employed?
DoorDash drivers, or “dashers,” are considered independent contractors. This means drivers will be filing a form 1099 instead of a W-2 with the IRS. Being an independent contractor in the U.S. also means you will be paying the total percentage of FICA taxes, which is 15.3%
What’s the Difference Between Employees and Nonemployees?
DoorDash drivers are classified as nonemployees. Employees and nonemployees have to pay FICA taxes. FICA taxes, or the Federal Insurance Care Act, includes social security and medicare taxes. Employees are required to pay 7.65%, while non-employees are required to pay the complete 15.3%.
Where Do I Find My Form 1099?
You’d receive a form 1099 if you made over $600 using DoorDash in the previous year. You can choose your delivery option for your form 1099. You may be able to choose an online form or physical copy.
When Do I File My Form 1099?
The time you have to file your form 1099 will vary from driver to driver. If you are dashing as a side gig, you may only have to file annually. However, some drivers may have to file quarterly, depending on their earnings. For more information, you can check out this calculator tool!
Can I Write Off Any Expenses?
Yes, as an independent contractor, you can write off some of your delivery expenses. Doing so could be a wise time investment and save you money down the line.
Some of the expenses you can deduct include:
- Your mobile phone and accessories used for work
- Vehicle loan payments
- Gas is deductible using the standard mileage rate
- Car care and maintenance fees
- Parking fees or expenses while working
- Tolls and fees when picking up or delivering
- Car depreciation over time
- Car insurance and registration
- DoorDash commission fees
Should I Keep My Dashing Expenses Separate From My Personal Expenses?
Keeping your DoorDash expenses separate from your personal life is a good use of your time. Holding an accurate record of your dashing expenses and using a different bank account will keep everything clean and organized. This advice goes for both full-time drivers and those using the app to supplement their income.
What Happens If I Don’t File My Taxes?
If you don’t file your taxes on time or incorrectly, you may face fees and penalties from the IRS. Whether your filing annually or quarterly, a good rule of thumb is to save some money when tax season comes along.
Storing money away for your taxes ensures you’ll have enough to pay what you might owe on time. To figure out how much you should save, you can run your income through a calculator tool each month.
Do DoorDash Drivers Set Their Own Hours?
DoorDash drivers can set their hours and be their own boss. However, there are some stipulations.
When you first begin driving for DoorDash, you’ll be required to choose a schedule from a set list of hours. For example, you might pick a 10 AM to 2 PM shift and a 4 PM to 8 PM shift. However, these shifts are dependent on the number of orders and drivers assigned.
DoorDash also has a “Top Dasher” program. Drivers who perform highly enter into this program, allowing them to dash whenever they like. This program will enable drivers to truly set their schedules without choosing shifts.
How Many Hours Can Drivers Work?
DoorDash drivers can work as much as they want or can. If dashers are using the scheduling system, they can schedule as many shifts as the app will let them. If dashers are in the Top Dasher program, they can leave the app running for as long as they see fit.
Do DoorDash Drivers Get Overtime?
Despite being able to work as many hours as they want, drivers will not be paid for overtime. DoorDash has a flat rate of $3 per order without including the tip. Although drivers won’t get paid overtime, the app does have occasional pay incentives/bonuses.
The pay bonuses are known as “Peak Pay.” Peak Pay may be at certain times, certain days of the week, or during holidays. These bonuses can range from an additional $1 per order to $3 per order.
Are Dashers Considered Self-Employed?
Yes, DoorDash drivers are considered self-employed. Dashers are independent contractors and file a form 1099 for taxes. Drivers will be their own boss and set their own hours. DoorDash drivers will also be required to pay the total 15.3% FICA tax rate.