TaskRabbit Taxes in Michigan - 2026 Guide

Updated for 2026 (Filing 2025 Taxes)

Tax Essentials for TaskRabbits in Michigan

From assembling furniture in Ann Arbor to helping with moving in Detroit, TaskRabbit provides flexible income opportunities across the Great Lakes State. However, that flexibility comes with tax responsibilities. As an independent contractor utilizing the TaskRabbit platform, understanding your tax obligations is crucial for a smooth tax season.

The IRS requires all individuals earning $400 or more as self-employed workers to report their income on Schedule C (Profit or Loss from Business) with Form 1040. This income is also subject to self-employment tax, which covers both Social Security and Medicare taxes. Unlike traditional employment, TaskRabbit does not withhold these taxes from your earnings, meaning you are responsible for calculating and paying them.

How Michigan Handles Gig Worker Taxes

As a resident of Michigan, filing a state income tax return is required, even if no Michigan income tax is due. Michigan operates under a flat income tax rate of 4.05% for the 2025 tax year. This applies to all levels of taxable income. TaskRabbit income, reported on your federal Schedule C, flows to your Michigan income tax return. The primary form for self-employed individuals to report income and calculate tax liability is Form MI-1040, Michigan's Individual Income Tax Return. You will need to report your net profit from Schedule C as part of your overall adjusted gross income on the MI-1040. Michigan also offers various credits and deductions that may reduce your tax liability; it's important to explore these options. Furthermore, estimated tax payments may be required throughout the year if you anticipate owing $500 or more in Michigan income tax. Failing to make these payments could result in penalties. Michigan's Department of Treasury provides comprehensive resources for self-employed individuals, including information on estimated taxes and available deductions. Keep meticulous records of all income and expenses to ensure accurate reporting and maximize potential deductions. Remember to consult the official Michigan Department of Treasury website for the most up-to-date information and forms: Michigan Department of Treasury.

Top Tax Deductions for Michigan Drivers

• Standard Mileage: The #1 deduction for TaskRabbits. The 2025 rate is 70 cents per mile. Given Michigan's diverse geography and potential for significant driving distances between tasks, especially in more rural areas, this rate can add up quickly.
• Tolls & Parking: While Michigan doesn't have extensive toll roads like some states, parking fees incurred while performing tasks are deductible. Keep receipts for parking in cities like Detroit, Grand Rapids, or Lansing.
• Phone & Data Plan: If you use your phone for scheduling tasks, communicating with clients, or navigating, you can deduct the percentage of your phone and data plan that is used for business purposes.
• Vehicle-Related Costs: Consider deductions for items like car cleaning supplies (to maintain a professional appearance), phone mounts for safe navigation, or insulated bags for delivering groceries or food items.

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

Understanding the 15.3% Self-Employment Tax

This tax comprises two components: 12.4% for Social Security and 2.9% for Medicare. Because TaskRabbit doesn’t withhold these taxes, it’s your responsibility to calculate and pay them, typically through quarterly estimated tax payments to the IRS. This ensures you don’t face penalties at the end of the year.