Amazon Flex Taxes in Kentucky - 2026 Guide

Updated for 2026 (Filing 2025 Taxes)

Tax Essentials for Amazon Flex Drivers in Kentucky

Delivering smiles across the Bluegrass State with Amazon Flex offers flexibility, but it also comes with tax responsibilities. As an independent contractor, understanding these obligations is crucial for a smooth tax season.

The IRS requires Amazon Flex drivers to report their earnings on Schedule C (Profit or Loss From Business) with Form 1040. Because you are self-employed, no taxes are automatically withheld from your earnings. This means you are responsible for paying both income tax and self-employment tax – covering Social Security and Medicare – on any net earnings over $400. Proper record-keeping throughout the year is essential to accurately calculate your tax liability.

How Kentucky Handles Gig Worker Taxes

As a resident of Kentucky, you are required to file a state income tax return, even if your federal tax liability is zero. Kentucky operates under a flat income tax rate, currently at 4.0% for the 2025 tax year. This means all taxable income is taxed at the same rate. Amazon Flex earnings are considered taxable income and must be reported. The primary form for self-employed individuals to report income and calculate Kentucky income tax is Form 740, Kentucky Income Tax Return. You will likely need to include Schedule SE (Self-Employment Tax) with your federal return, and the corresponding information will flow to your Kentucky return. Kentucky also allows for certain deductions that can reduce your taxable income, such as those related to business expenses. It's important to note that Kentucky conforms to many federal deductions, but it's always best to consult the Kentucky Department of Revenue for the most up-to-date information. Estimated tax payments may be required throughout the year if you anticipate owing $500 or more in Kentucky income tax. Failing to make these payments could result in penalties. For detailed information and resources, please visit the Kentucky Department of Revenue website: https://revenue.ky.gov/

Top Tax Deductions for Kentucky Drivers

• Standard Mileage: The most popular deduction for Amazon Flex drivers. The 2025 rate is 70 cents per mile. Given Kentucky's generally moderate gas prices, the standard mileage rate is often a very beneficial option, simplifying record-keeping.
• Tolls & Parking: Kentucky has some toll roads, particularly around Louisville. Keep detailed records of any tolls paid directly related to deliveries. Parking fees incurred while actively working are also deductible.
• Phone & Data Plan: If you use your personal phone for Amazon Flex work (navigation, communicating with Amazon, etc.), you can deduct the percentage of your monthly bill that corresponds to business use.
• Vehicle-Related Costs: Expenses like car washes to maintain a professional appearance, phone mounts for safe navigation, insulated hot bags for food deliveries, and dash cams for security are all potentially deductible business expenses.

Key Warning: You cannot deduct both the standard mileage rate and actual car expenses (like gas, oil changes, repairs, insurance) in the same tax year. Choose the method that yields the larger deduction.

Understanding the 15.3% Self-Employment Tax

This tax covers both Social Security and Medicare taxes. When you work for a traditional employer, these taxes are split between you and your employer. As an Amazon Flex driver, you are both the employer and the employee, meaning you are responsible for the full 15.3% tax on your net earnings exceeding $400. This is in addition to your regular income tax liability.