QUESTION
Can you write off car expenses for a delivery side hustle?
Yes—if you use your car for a delivery side hustle as an independent contractor, you can usually deduct the business portion of car expenses on your federal taxes. This generally applies to 1099 delivery work such as DoorDash, Uber Eats, or Instacart. W-2 employees usually cannot deduct their own unreimbursed vehicle expenses on a federal return.
You generally must choose one of two methods for the business portion of the car:
- Standard mileage rate
- Actual expenses method
Either way, keep a contemporaneous mileage log with the date, destination or business purpose, and business miles driven. You cannot deduct personal miles, commuting, or personal errands.
A key IRS rule to verify: the method you choose can affect whether you’re allowed to switch methods later, and the timing of your first use of the car for business matters. Check the current IRS rules for the exact timing and whether your situation allows a change.
Exact tax rules can change, so if you want to claim this deduction, it’s a good idea to confirm the current IRS guidance or check with a tax professional.