Tax Information for Shipt Shoppers
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.
A best practice is to aim for setting aside 25-30% of each paycheck for 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.
- 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 are $400 or more, and you can deduct certain expenses from your taxes
- If you have earned $600 or more, 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.
- To sign up with Everlance and get your first 3 months free, click here.
- Tap "Get Everlance", sign up or log in, and then tap "Shipt" or "Premium/Upgrade" and the price will show as $0 for the first 3 months
- IRS: Self-Employed Individuals Tax Center
- IRS: Self-Employment Tax
- Everlance Tax Academy for Shipt Shoppers
- Everlance: Taxes for Self-Employed Individuals
- Everlance: The Self-Employment Tax
At the end of each year, shoppers will be prompted to confirm which delivery method they prefer their tax form be sent to — shoppers may select either their email or physical mailing address.
*Note: tax forms will not be issued to Shoppers who earned less than $600 in the calendar year
After the notification icon displays on the main menu, shoppers 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 the 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 email@example.com.
- If you need to update your mailing address, you can do so from the Account screen in the shopper app. If you need to update your email, please reach out to firstname.lastname@example.org.