How the mileage deduction works for gig drivers
As an independent contractor you can deduct vehicle costs using the standard mileage rate — 72.5¢ per business mile in 2026 (IRS Notice 2026-10). Deductible miles include driving to pickups, during deliveries, and between orders while the app is on. Your commute from home to your starting area generally doesn't count.
The deduction is powerful because it cuts two taxes at once: self-employment tax (15.3% on 92.35% of profit — about 14.1% effective) and federal income tax at your bracket. It comes off your Schedule C profit, so you benefit even if you take the standard deduction.
Standard mileage vs. actual expenses
You can deduct actual costs (gas, repairs, insurance, depreciation) instead, but for most gig drivers in efficient cars the standard rate is both larger and far simpler. If you use the standard rate, use it the first year the car is in service.
Next: estimate your quarterly tax payments or check your true hourly pay.