TaskRabbit Taxes in Minnesota - 2026 Guide

Updated for 2026 (Filing 2025 Taxes)

Tax Essentials for TaskRabbits in Minnesota

From assembling furniture in Minneapolis to helping with moving in St. Paul, being a TaskRabbit in Minnesota offers flexibility, but also comes with tax responsibilities. As an independent contractor, understanding these obligations is crucial for a smooth tax season.

The IRS requires all TaskRabbit earnings to be reported as self-employment income. This means filing a Schedule C (Profit or Loss from Business) with your federal income tax return (Form 1040). Furthermore, earnings exceeding $400 necessitate the payment of self-employment taxes, covering both Social Security and Medicare contributions, which are not automatically withheld from your TaskRabbit payments.

How Minnesota Handles Gig Worker Taxes

As a resident of Minnesota, filing a state income tax return is required, even if no federal tax is owed. Minnesota utilizes a graduated income tax system, meaning the tax rate increases as your income rises. This means your tax bracket, and therefore your tax rate, will depend on your total taxable income for the year. TaskRabbit income is fully subject to Minnesota income tax. The primary form for self-employed individuals to report income and calculate tax liability is Form M1, Individual Income Tax Return, along with Schedule 1, which is used to report business income. Minnesota also requires you to pay estimated taxes quarterly if you expect to owe $1,000 or more in state income tax. Failure to do so may result in penalties. Minnesota’s Department of Revenue provides detailed information and resources for self-employed individuals, including estimated tax payment options and filing instructions. It's important to note that Minnesota conforms to many federal deductions, but there can be differences, so careful review of state guidelines is essential. The state also offers various credits and deductions that may be applicable to your specific situation. For the most up-to-date information and forms, please visit the Minnesota Department of Revenue website: https://www.revenue.state.mn.us/

Top Tax Deductions for Minnesota Drivers

• Standard Mileage: The #1 deduction for most TaskRabbits. The 2025 rate is 70 cents per mile. Given Minnesota's winters and potential for driving long distances between tasks, this rate can significantly reduce your tax burden.
• Tolls & Parking: While Minnesota doesn't have extensive toll roads, any parking fees incurred while performing TaskRabbit tasks are deductible. Keep detailed records of these expenses.
• Phone & Data Plan: If you use your phone for TaskRabbit-related communication, scheduling, or navigation, you can deduct the percentage of your monthly bill attributable to business use.
• Vehicle-Related Costs: Expenses like car cleaning supplies (especially important during Minnesota’s harsh winters!), phone mounts, or insulated bags for food delivery tasks are deductible.

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 covers both Social Security and Medicare taxes. Unlike traditional employment where these taxes are withheld from your paycheck, as a TaskRabbit, you are responsible for paying both the employer and employee portions. Platforms like TaskRabbit do not withhold these taxes, so it’s crucial to factor this into your financial planning and potentially make quarterly estimated tax payments to avoid penalties.