Instacart Shopper Taxes in Houston, Texas - 2026

Updated for 2026 (Filing 2025 Taxes)

Tax Essentials for Instacart Shoppers in Houston, Texas

Navigating the bustling streets of Houston as an Instacart shopper offers flexibility, but it also comes with tax responsibilities. As an independent contractor, earnings from deliveries through 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 on it. This is typically done using Schedule C (Profit or Loss from Business) when filing your federal income tax return (Form 1040). Crucially, this income is also subject to self-employment tax, which covers both Social Security and Medicare taxes – taxes that are not automatically withheld from your earnings as they would be with a traditional employer.

How Texas Handles Gig Worker Taxes

The big perk in the Lone Star State is no personal income tax. However, be aware of the Texas Franchise Tax. While it has a high threshold (over $1.2 million) that rarely applies to solo gig workers, it's a key part of the state's business tax structure. As an Instacart shopper operating in Houston, you won’t face state income tax on your earnings, but maintaining accurate records of your income and expenses is still vital for federal tax compliance. Consider the unique demands of delivering in Houston – traffic congestion can significantly impact mileage, and parking costs, especially in areas like the Galleria or downtown, can add up. These parking expenses are deductible (see section below). Furthermore, while Texas doesn’t have a state income tax, it’s important to understand that the lack of state income tax doesn’t eliminate federal tax obligations. Staying organized with mileage logs and expense tracking is paramount. The Texas Comptroller’s office provides resources for businesses, even sole proprietors, to understand their tax obligations.

You can find more information about Texas taxes at the Texas Comptroller of Public Accounts website.

Top Tax Deductions for Houston, Texas Drivers

• Standard Mileage: The #1 deduction. The 2025 rate is 70 cents/mile. Given relatively lower gas prices in Texas compared to states like California, the standard mileage rate is often the most advantageous method for Instacart shoppers in Houston.
• Tolls & Parking: Houston’s extensive highway system utilizes the Harris County Toll Road Authority (HCTRA) and TxTag. Keep detailed records of all toll expenses and parking fees incurred while actively shopping and delivering orders.
• Phone & Data Plan: The percentage of your phone and data plan used for business purposes (e.g., navigating with the Instacart app, communicating with customers) is deductible.
• Vehicle-Related Costs: Expenses like car washes to maintain a professional appearance, phone mounts for safe navigation, insulated hot bags to keep orders at the correct temperature, and even small tools for minor vehicle maintenance are potentially 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

Self-employment tax is a combined tax for Social Security and Medicare. Unlike traditional employment where your employer withholds these taxes, as an Instacart shopper, you are responsible for paying both the employer and employee portions. This amounts to 15.3% on your net earnings (income after deductions) exceeding $400. Remember to factor this into your tax planning throughout the year to avoid surprises during filing season.