Instacart Shopper Taxes in Texas - 2026 Guide

Updated for 2026 (Filing 2025 Taxes)

Tax Essentials for Instacart Shoppers in Texas

Navigating the bustling streets of Texas cities and towns as an Instacart shopper offers flexibility, but also brings 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 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. Instacart shoppers operating as sole proprietorships or single-member LLCs generally won’t be impacted by the Franchise Tax unless their gross revenue significantly exceeds this amount. Texas does not have a state income tax, meaning you won’t file a state income tax return based on your Instacart earnings. However, it’s important to understand that Texas does collect sales tax, and while Instacart generally handles the collection and remittance of sales tax on behalf of shoppers, it’s always wise to stay informed about any potential changes to these regulations. For the most up-to-date information on Texas taxes, including business taxes and sales tax rules, consult the Texas Comptroller of Public Accounts: https://comptroller.texas.gov/. Remember, even without state income tax, accurate record-keeping is vital for federal tax compliance.

Top Tax Deductions for Texas Drivers

• Standard Mileage: The #1 deduction. The 2025 rate is 70 cents/mile. With generally lower gas prices in Texas compared to other states, the standard mileage rate often provides a substantial deduction for Instacart shoppers, simplifying tax calculations.
• Tolls & Parking: Texas has several toll road systems, including those around major metropolitan areas like Dallas, Houston, Austin, and San Antonio. Keep detailed records of all toll expenses and parking fees incurred while actively shopping or delivering for Instacart. TxTag and other electronic toll payment systems can help with record-keeping.
• Phone & Data Plan: The percentage of your phone and data plan used for business purposes is deductible. If you use your phone exclusively for Instacart, you can deduct the entire cost. Otherwise, carefully track business usage.
• Vehicle-Related Costs: Expenses like car washes, phone mounts, insulated hot/cold bags, and dash cams used for business are deductible. 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

Self-employment tax is a combined Social Security and Medicare tax for individuals who work for themselves. Because platforms like Instacart don’t withhold these taxes from your earnings, you are responsible for paying them directly to the IRS. The current rate is 15.3% on net earnings over $400. This means after deducting your business expenses from your gross income, if your net profit exceeds $400, you’ll owe self-employment tax on that amount.