DoorDash Dasher Taxes in New Jersey - 2026 Guide

Updated for 2026 (Filing 2025 Taxes)

Tax Essentials for DoorDash Dashers in New Jersey

Navigating the Garden State as a DoorDash Dasher offers flexibility, but also brings tax responsibilities. As an independent contractor, understanding these obligations is crucial for a smooth tax season.

DoorDash drivers in New Jersey, like all independent contractors, are required to report their income to the IRS on Schedule C (Profit or Loss From Business) with Form 1040. Furthermore, earnings exceeding $400 necessitate the payment of self-employment taxes, covering both Social Security and Medicare contributions. Accurate record-keeping throughout the year is essential to maximize deductions and minimize tax liability.

How New Jersey Handles Gig Worker Taxes

As a resident of New Jersey, a state income tax return is required, regardless of income level. New Jersey operates on a graduated income tax system, meaning the tax rate increases as your income rises. For the 2025 tax year, self-employed individuals will primarily use Form NJ-1040, New Jersey Resident Income Tax Return, along with Schedule NJ-SE, Self-Employment Earnings. It's important to note that New Jersey also has a state-level Earned Income Tax Credit (EITC) which may benefit lower-income Dashers. New Jersey also requires you to pay estimated taxes quarterly if you expect to owe more than $500 in state income tax. Failure to do so can result in penalties. The Division of Taxation offers resources and guidance specifically for self-employed individuals, and it's recommended to consult their website for the most up-to-date information and forms. New Jersey also allows for certain business expense deductions that mirror federal deductions, potentially reducing your taxable income. Keep detailed records of all income and expenses to accurately complete your state return.

You can find more information and resources on the New Jersey Division of Taxation website: https://www.nj.gov/treasury/taxation/

Top Tax Deductions for New Jersey Drivers

• Standard Mileage: The most popular deduction for DoorDash drivers. The 2025 rate is 70 cents per mile. Given New Jersey's relatively high cost of living and frequent traffic, the standard mileage rate is often the most beneficial option.
• Tolls & Parking: New Jersey drivers frequently encounter tolls on the New Jersey Turnpike and Garden State Parkway. These tolls, along with any parking fees incurred while actively dashing, are deductible business expenses.
• Phone & Data Plan: If you use your personal phone for DoorDash, you can deduct the percentage of your monthly bill that corresponds to business use. Keep a log of the time spent dashing to accurately calculate this percentage.
• Vehicle-Related Costs: Expenses like car washes, phone mounts, dash cams, and insulated food bags are all deductible as business expenses. Keep receipts for all purchases.

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

The 15.3% self-employment tax covers both Social Security and Medicare taxes. Unlike traditional employment where these taxes are withheld from your paycheck, as a DoorDash driver, you are responsible for paying both the employer and employee portions. DoorDash (and other platforms) does not withhold these taxes for you, so it’s crucial to plan for this expense when filing your taxes.