Amazon Flex Taxes in Philadelphia, Pennsylvania - 2026

Updated for 2026 (Filing 2025 Taxes)

Tax Essentials for Amazon Flex Drivers in Philadelphia, Pennsylvania

Navigating the historic streets of Philadelphia as an Amazon Flex driver offers flexibility, but also introduces unique tax considerations. Delivering packages from Center City to Chestnut Hill requires understanding how your earnings are taxed as an independent contractor.

As an Amazon Flex driver, you are classified as an independent contractor by the IRS. This means you’re responsible for reporting your income on Schedule C (Profit or Loss from Business) with your federal income tax return (Form 1040). Crucially, it also means you’ll likely owe self-employment tax, covering both Social Security and Medicare, as Amazon does not withhold these taxes from your payments.

How Pennsylvania Handles Gig Worker Taxes

As a resident of Pennsylvania, you are required to file a state income tax return, even if no state income tax was withheld. Pennsylvania operates under a flat income tax rate of 3.07% for the 2025 tax year. This applies to all taxable income, including earnings from Amazon Flex. The primary form for self-employed individuals to report income and calculate tax liability is Pennsylvania Schedule C-EZ (or Schedule C if your business is more complex). It's important to note that Pennsylvania considers all income earned, regardless of where the delivery takes place, as taxable within the state. Philadelphia, being a major city, presents specific challenges and opportunities. Parking can be expensive and difficult to find while on deliveries, and these costs are potentially deductible (see section below). Demand for Flex drivers can fluctuate significantly based on events like Eagles games, festivals, and seasonal shopping periods. Keep accurate records of your mileage and expenses throughout the year, as the Pennsylvania Department of Revenue actively audits self-employment income. Remember to factor in any local taxes or fees specific to operating a business within Philadelphia. For more detailed information and resources, please visit the Pennsylvania Department of Revenue website: https://www.revenue.pa.gov/

Top Tax Deductions for Philadelphia, Pennsylvania Drivers

• Standard Mileage: The most popular and often simplest deduction. The 2025 rate is 70 cents per mile for business use of your vehicle. Given Philadelphia’s traffic and density, maximizing mileage tracking is crucial.
• Tolls & Parking: Philadelphia has limited toll roads, but parking expenses, especially in Center City and University City, can add up quickly. Keep detailed receipts for all parking fees incurred while actively working.
• Phone & Data Plan: You can deduct the percentage of your phone and data plan that is used for business purposes. If you use your phone solely for Amazon Flex deliveries, you can deduct the entire cost.
• Vehicle-Related Costs: Expenses like car washes (to maintain a professional appearance), phone mounts, dash cams, and insulated hot bags are all potentially deductible business expenses.

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

Understanding the 15.3% Self-Employment Tax

The 15.3% self-employment tax is comprised of two parts: 12.4% for Social Security and 2.9% for Medicare. Unlike traditional employment, Amazon and other gig platforms do not withhold these taxes from your earnings. You are responsible for calculating and paying this tax when you file your federal income tax return. However, you can reduce your self-employment tax liability by deducting one-half of your self-employment tax from your gross income.