Instacart Shopper Taxes in Nebraska - 2026 Guide

Updated for 2026 (Filing 2025 Taxes)

Tax Essentials for Instacart Shoppers in Nebraska

Navigating the plains and delivering groceries through Instacart provides a flexible income opportunity for many Nebraskans, but it also comes with tax responsibilities. As an independent contractor for Instacart, earnings are considered self-employment income, requiring careful attention to both federal and state tax obligations.

The IRS requires all Instacart shoppers to report their income on Schedule C (Profit or Loss from Business) with Form 1040. Crucially, because no taxes are withheld from Instacart payments, shoppers are responsible for paying self-employment taxes – Social Security and Medicare – on net earnings exceeding $400.

How Nebraska Handles Gig Worker Taxes

As a resident of Nebraska, filing a state income tax return is required, even if no Nebraska income tax is ultimately due. Nebraska utilizes a graduated income tax system, meaning the tax rate increases as income rises. For the 2025 tax year, Nebraska’s primary form for self-employed individuals is Form 1040-N, Nebraska Individual Income Tax Return, along with Schedule I, Adjustments to Income. Instacart income reported on your federal Schedule C flows to your Nebraska return as part of your adjusted gross income. Nebraska also allows for certain deductions similar to the federal level, potentially reducing your state tax liability. It's important to note that Nebraska offers a standard deduction, and taxpayers may also itemize if their itemized deductions exceed the standard deduction amount. Furthermore, Nebraska has a system of tax credits that may be available to eligible taxpayers, potentially further reducing the amount of tax owed. Keep accurate records of all income and expenses to ensure accurate filing. For the most up-to-date information and forms, consult the Nebraska Department of Revenue website: Nebraska Department of Revenue.

Top Tax Deductions for Nebraska Drivers

• Standard Mileage: The most popular deduction for Instacart shoppers. The 2025 rate is 70 cents per mile. Given Nebraska’s relatively stable gas prices, the standard mileage rate is often a beneficial and simplified method for calculating vehicle expenses.
• Tolls & Parking: While Nebraska doesn’t have extensive toll roads, any tolls incurred while making deliveries are deductible. Parking fees directly related to Instacart deliveries are also deductible.
• Phone & Data Plan: If you use your phone for Instacart (navigation, communication with customers), you can deduct the percentage of your monthly bill attributable to business use. Keep a log of business vs. personal usage.
• Vehicle-Related Costs: Expenses like car washes to maintain a professional appearance, phone mounts for safe navigation, and insulated hot bags used for deliveries are all 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. Unlike traditional employment where your employer withholds these taxes, as an Instacart shopper, you are responsible for paying both the employer and employee portions, totaling 15.3% on net earnings over $400. You’ll calculate this on Schedule SE (Self-Employment Tax) and include it with your Form 1040.