Instacart Shopper Taxes in Oregon - 2026 Guide

Updated for 2026 (Filing 2025 Taxes)

Tax Essentials for Instacart Shoppers in Oregon

Navigating the scenic routes and delivering groceries across the diverse landscapes of Oregon as an Instacart shopper offers flexibility, but also comes with 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 primarily 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.

How Oregon Handles Gig Worker Taxes

As a resident of Oregon, filing a state income tax return is mandatory, even if no federal tax is owed. Oregon utilizes a graduated income tax system, meaning the tax rate increases as your income rises. For the 2025 tax year, Instacart shoppers operating as self-employed individuals will primarily use Form OR-40, the Oregon Individual Income Tax Return, to report their earnings. Schedule OR-I, Income from Business Activities, is used to detail income and expenses related to your Instacart work, mirroring the federal Schedule C. Oregon also requires you to calculate and pay estimated taxes quarterly if you anticipate owing more than $1,000 in state income tax for the year. This prevents penalties at tax time. Oregon’s Department of Revenue provides detailed guidance and resources for self-employed individuals, including information on estimated tax payments and available credits. It's crucial to understand that Oregon does not have local income taxes levied by cities or counties, simplifying the state tax landscape compared to some other states. Keep meticulous records of all income and expenses to accurately calculate your Oregon tax liability. The Oregon Department of Revenue offers a wealth of information and tools to assist with tax preparation.

You can find more information and resources on the Oregon Department of Revenue website: https://www.oregon.gov/dor

Top Tax Deductions for Oregon 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: While Oregon doesn't have extensive toll roads, any tolls incurred during deliveries, along with parking fees directly related to shopping or delivering, are deductible.
• Phone & Data Plan: The portion of your cell phone and data plan used for Instacart work is deductible. Keep records demonstrating the business use percentage.
• Vehicle-Related Costs: Expenses like car washes to maintain a professional appearance, phone mounts for safe navigation, insulated hot bags, and even hand sanitizer are deductible as business expenses.

Key Warning: You cannot deduct both the standard mileage rate and actual car expenses (like gas, oil changes, repairs, and 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 these taxes are withheld from your paycheck, as an Instacart shopper, you are responsible for paying both the employer and employee portions. This combined rate of 15.3% applies to your net earnings (income minus business expenses) exceeding $400.