Instacart Shopper Taxes in Massachusetts - 2026 Guide

Updated for 2026 (Filing 2025 Taxes)

Tax Essentials for Instacart Shoppers in Massachusetts

Navigating the historic streets of Boston and beyond as an Instacart shopper offers flexibility, but also brings tax responsibilities. As an independent contractor, earnings from Instacart are considered self-employment income, requiring careful attention during tax season.

The IRS requires all self-employed individuals, including Instacart shoppers, to report their income and pay taxes. This is typically done using Schedule C (Profit or Loss from Business) when filing your federal income tax return (Form 1040). Furthermore, earnings over $400 necessitate the payment of self-employment taxes, covering both Social Security and Medicare contributions, which are not automatically withheld from your Instacart payouts.

How Massachusetts Handles Gig Worker Taxes

As a resident of Massachusetts, filing a state income tax return is mandatory, even if no state income tax is owed. Massachusetts employs a flat income tax rate of 5.0% for the 2025 tax year. This means all taxable income is subject to the same rate. Instacart shoppers operating as independent contractors will report their self-employment income on Form 1 (Massachusetts Form 1), and will likely need to complete Schedule SE (Self-Employment Earnings) as part of their federal return, which then flows to the state return. Massachusetts also requires the filing of Form M-929, Schedule SE, to calculate the state portion of self-employment tax. It’s crucial to accurately track income and expenses throughout the year to ensure proper reporting. Massachusetts offers resources for independent contractors, including information on estimated tax payments, to avoid potential penalties. Remember to keep detailed records of all income received from Instacart and any related business expenses. The Massachusetts Department of Revenue provides comprehensive information and resources for taxpayers; you can find more details at Massachusetts Department of Revenue.

Top Tax Deductions for Massachusetts Drivers

• Standard Mileage: The most popular deduction for Instacart shoppers. For the 2025 tax year, the standard mileage rate is 70 cents per mile. This simplifies expense tracking significantly.
• Tolls & Parking: Massachusetts drivers frequently encounter tolls on the Massachusetts Turnpike and other roadways. These toll expenses, along with parking fees incurred while actively shopping or delivering, are deductible.
• Phone & Data Plan: If you use your personal phone for Instacart work (which is common), you can deduct the percentage of your monthly bill that corresponds to business use. Keep a log of the time spent working to justify the deduction.
• Vehicle-Related Costs: Expenses like car washes to maintain a professional appearance, phone mounts for safe navigation, and insulated hot/cold bags used specifically for deliveries are all deductible.

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

Understanding the 15.3% Self-Employment Tax

The 15.3% self-employment tax comprises two components: 12.4% for Social Security and 2.9% for Medicare. Unlike traditional employment, Instacart and other gig platforms do not withhold these taxes from your earnings. Therefore, it’s your responsibility to calculate and pay this tax, typically through estimated tax payments made quarterly to the IRS and the Massachusetts Department of Revenue.