70¢
2026 Mileage Rate*
15.3%
Self-Employment Tax
$5,000+
Avg. Driver Deductions
Apr 15
2026 Filing Deadline
*Projected rate based on IRS trends. Final 2026 rate announced in December 2026.
Table of Contents
Why This Guide Matters
As an Amazon Flex driver, you're classified as an independent contractor - not an employee. This means Amazon doesn't withhold taxes from your earnings, and you're responsible for understanding and paying your own taxes. The good news? You also have access to significant tax deductions that can reduce your tax bill by thousands of dollars.
The average Amazon Flex driver who properly tracks and claims their deductions saves between $3,000 to $7,000 annually on taxes compared to those who don't. This guide will show you exactly how to maximize those savings legally and efficiently.
Important: Tax laws change frequently. While this guide is accurate as of December 2026 for the 2026 tax year, always verify current rates with the IRS or a tax professional. This guide is for educational purposes and does not constitute tax advice.
1. Understanding Your Tax Situation
When you work for Amazon Flex, you're operating as a self-employed business owner, not an employee. This fundamental distinction affects everything about how you're taxed.
Employee vs. Independent Contractor
W-2 Employee
- ❌ Taxes withheld from paycheck
- ❌ Employer pays half of payroll taxes
- ❌ Limited deduction opportunities
- ❌ Simple tax filing
Amazon Flex (1099 Contractor)
- ✔ No taxes withheld - you keep 100% upfront
- ✔ Pay full self-employment tax (but deduct half)
- ✔ Many deduction opportunities
- ✔ Requires quarterly estimated payments
Types of Taxes You'll Pay
Federal Income Tax
Based on your tax bracket (10% - 37%)
Self-Employment Tax
Social Security (12.4%) + Medicare (2.9%)
State Income Tax
Varies by state (0% - 13.3%)
The Silver Lining
While it may seem like you're paying more taxes as a contractor, the reality is that after deductions, many Amazon Flex drivers actually pay less in taxes than W-2 employees earning the same gross amount. The key is proper tracking and claiming every legitimate deduction.
2. Tax Forms You'll Receive & File
Forms You'll Receive from Amazon
Nonemployee Compensation
Amazon sends this form if you earned $600+ during the tax year. It shows your total earnings (before any expenses). You'll receive it by January 31, 2026 for the 2026 tax year.
Access your 1099 through the Amazon Flex app under "Tax Information" or via Amazon's tax portal.
Forms You'll File
Schedule C (Form 1040)
Profit or Loss from Business - This is where you report all your Amazon Flex income AND deductions. The difference (profit) flows to your 1040.
Key Lines:
- Line 1: Gross receipts (1099-NEC amount)
- Line 9: Car and truck expenses (mileage deduction)
- Line 27a: Other expenses (phone, supplies, etc.)
- Line 31: Net profit or loss
Schedule SE
Self-Employment Tax - Calculates your Social Security and Medicare taxes based on your Schedule C profit.
Form 1040-ES
Estimated Tax for Individuals - Used for making quarterly estimated tax payments throughout the year.
3. Self-Employment Tax Explained
Self-employment tax is the single largest tax surprise for new gig workers. Here's what you need to know:
The 15.3% Reality
Social Security: 12.4%
Applies to first $168,600 of net earnings (2026 cap)
Medicare: 2.9%
Applies to all net earnings (no cap)
How It's Calculated
Good News: You can deduct half of your self-employment tax when calculating your adjusted gross income. This effectively reduces your income tax AND is available even if you take the standard deduction.
4. Quarterly Estimated Taxes
Unlike W-2 employees who have taxes withheld each paycheck, you're responsible for paying taxes throughout the year. The IRS requires quarterly estimated tax payments if you expect to owe $1,000 or more.
2026 Quarterly Tax Deadlines
Q1: January - March 2026
Due: April 15, 2026
Q2: April - May 2026
Due: June 16, 2026
Q3: June - August 2026
Due: September 15, 2026
Q4: September - December 2026
Due: January 15, 2027
How Much to Set Aside
Rule of Thumb: Set aside 25-30% of your net earnings (after deducting expenses) for taxes. This covers both self-employment tax and federal income tax.
Example Calculation:
- Gross earnings this quarter: $10,000
- Estimated expenses (mileage, etc.): $3,000
- Net earnings: $7,000
- Set aside for taxes (30%): $2,100
How to Pay Quarterly Taxes
- 1 IRS Direct Pay: Free online payment at irs.gov/payments
- 2 EFTPS: Electronic Federal Tax Payment System (requires enrollment)
- 3 Mail: Send check with Form 1040-ES voucher
Avoid Penalties: Missing quarterly payments can result in underpayment penalties. The safe harbor rule: Pay at least 100% of last year's tax liability (110% if AGI was over $150,000) to avoid penalties, regardless of what you actually owe.
5. Mileage Deduction (The Big One)
2026 IRS Standard Mileage Rate
70¢ per mile*
*Projected rate. Final rate announced by IRS in December 2026.
The mileage deduction is typically the largest tax savings for Amazon Flex drivers. Every business mile you drive is deductible, and those miles add up fast.
What Miles Count?
✔ Deductible Miles
- Driving to the warehouse/pickup location
- All miles during your delivery block
- Driving between deliveries
- Driving home after your last delivery
- Miles to pick up supplies (bags, phone mount)
- Driving to the bank to deposit earnings
- Miles to meet with tax professional
❌ Non-Deductible Miles
- Personal errands during a block
- Driving for personal reasons (groceries, etc.)
- Commuting to a non-Flex W-2 job
- Recreational driving
Real-World Example
Let's say you drive 15,000 business miles in 2026:
If you're in the 22% tax bracket, this deduction saves you $2,310 in federal income tax alone!
Best Mileage Tracking Apps
Everlance
Auto-tracking, expense logging, IRS-compliant reports
Free Tier AvailableStride
100% free, automatic tracking, tax estimates
Completely FreeGridwise
Designed for gig workers, earnings insights
Free Tier AvailablePro Tip: Start tracking mileage from day one, even before you get your first block. The IRS requires contemporaneous records - you can't reconstruct mileage logs at tax time. Use an app that automatically tracks trips.
6. Actual Vehicle Expenses Method
Instead of the standard mileage rate, you can choose to deduct your actual vehicle expenses. You must choose one method - you cannot combine them.
What You Can Deduct
Which Method is Better?
| Factor | Standard Mileage | Actual Expenses |
|---|---|---|
| Record Keeping | Simple - just track miles | Complex - save all receipts |
| Newer, Fuel-Efficient Car | Usually better | May be lower |
| Older Car with High Repairs | May be lower | Could be better |
| Depreciation | Built into rate | Can claim separately |
Our Recommendation: For most Amazon Flex drivers, the standard mileage rate is simpler and often provides a larger deduction. Calculate both methods your first year to see which works better for your situation.
7. Other Deductible Expenses
Beyond mileage, there are numerous other expenses you can deduct. Here's a comprehensive list:
Cell phone bill (business %)
Deduct the percentage used for Amazon Flex (typically 50-75%)
Phone mount
100% deductible if used primarily for delivery
Portable charger / car charger
Essential for keeping your phone charged during blocks
Dash cam
For delivery documentation and safety
Insulated delivery bags
Required for Whole Foods / grocery deliveries
Flashlight / headlamp
For night deliveries and finding addresses
Trunk organizer
Keeps packages organized during delivery
Hand sanitizer / cleaning supplies
For maintaining cleanliness while handling packages
Comfortable work shoes
If used primarily for deliveries
Parking fees (while on delivery)
Parking meters, garage fees during blocks
Tolls
Business-related toll road expenses
Car washes
Maintaining a professional appearance
Tax preparation fees
CPA, tax software, or tax prep service costs
Accounting software
QuickBooks Self-Employed, Wave, etc.
Mileage tracking app subscriptions
Everlance, MileIQ premium features
Self-employed health insurance premiums
If you're not eligible for employer coverage, you can deduct 100% of health, dental, and vision insurance premiums for yourself, spouse, and dependents. This is an "above the line" deduction taken on Form 1040, not Schedule C.
8. Home Office Deduction
If you use part of your home exclusively and regularly for Amazon Flex administrative tasks, you may qualify for the home office deduction.
Caution: The home office deduction is one of the most audited areas for gig workers. Make sure you truly have a dedicated space used exclusively for business. A corner of your living room doesn't count.
Qualifying Activities for Flex Drivers
- ✔ Scheduling and managing blocks in the app
- ✔ Tracking expenses and mileage
- ✔ Organizing receipts and records
- ✔ Researching tax strategies and gig economy news
Simplified Method
The IRS offers a simplified method that's easier to calculate:
$5
per square foot
300
max square feet
$1,500
max deduction
9. Record Keeping Best Practices
Good records are your best defense in an audit and ensure you don't miss any deductions. The IRS requires you to keep records for 3-7 years.
What to Track
Daily Tracking
- • Every business mile driven
- • Start/end odometer readings
- • Block start and end times
- • Number of deliveries
- • Expenses incurred
Monthly/Annual
- • Total earnings from Amazon Flex
- • Earnings from other gig apps
- • Quarterly estimated tax payments
- • Annual mileage summary
- • All expense receipts (digital OK)
Recommended System
-
1
Use a mileage tracking app - Everlance, Stride, or Gridwise will automatically log your trips
-
2
Photograph all receipts immediately - Use your phone's notes app or a dedicated app like Expensify
-
3
Create a dedicated business bank account or credit card - Makes tracking expenses automatic
-
4
Download Amazon Flex earnings weekly - Keep records in case the app data becomes unavailable
10. Common Tax Mistakes to Avoid
Mistake #1: Not Tracking Mileage from Day One
Many new drivers don't realize mileage is deductible or forget to track it. You cannot recreate a mileage log at tax time - the IRS requires contemporaneous records. Start tracking immediately.
Mistake #2: Forgetting About Self-Employment Tax
First-time gig workers often only plan for income tax and are shocked by the 15.3% self-employment tax. Always set aside 25-30% of net earnings.
Mistake #3: Mixing Personal and Business Expenses
Using one credit card for everything makes it hard to identify deductions and looks suspicious to the IRS. Keep business expenses separate.
Mistake #4: Claiming 100% Business Use of Personal Items
Unless an item is used exclusively for Amazon Flex (like insulated bags), you should only deduct the business-use percentage. Claiming 100% phone use for business when you also use it personally is a red flag.
Mistake #5: Skipping Quarterly Payments
The IRS charges penalties and interest for underpayment. Even if cash is tight, make at least the minimum quarterly payments to avoid additional costs.
Mistake #6: Not Claiming All Legitimate Deductions
The opposite problem - some drivers are so afraid of audits they don't claim deductions they're entitled to. If it's a legitimate business expense and you have documentation, claim it.
11. Best Tax Software for Gig Workers
TurboTax Self-Employed
Best OverallMost comprehensive for gig workers. Guides you through Schedule C, finds deductions, and offers audit support.
- ✔ Auto-imports 1099s
- ✔ Mileage calculator built-in
- ✔ Quarterly tax estimates
- ✔ Audit defense included
~$120-170 (federal + state)
H&R Block Self-Employed
Best ValueSolid alternative with similar features. Option to visit a local office if you need in-person help.
- ✔ Good deduction finder
- ✔ In-person support option
- ✔ Expense tracking app
- ✔ Slightly lower cost
~$85-115 (federal + state)
FreeTaxUSA
Budget option that handles Schedule C. Less guidance than premium options, but works well if you're comfortable with taxes.
- ✔ Free federal filing
- ✔ Handles self-employment
- ✔ State filing ~$15
- ❌ Less hand-holding
$0-15 total
TaxAct Self-Employed
Middle-ground option with good features at a reasonable price. Includes deduction maximizer.
- ✔ Schedule C support
- ✔ Deduction finder
- ✔ Good mobile app
- ✔ Price lock guarantee
~$65-95 (federal + state)
12. Frequently Asked Questions
Do I need to file taxes if I only made a little from Amazon Flex?
If your net self-employment income (from all sources) exceeds $400, you must file a tax return and pay self-employment tax, even if you don't owe income tax. This is a common trap for part-time gig workers.
What if I didn't receive a 1099 from Amazon?
Amazon only sends a 1099-NEC if you earned $600 or more. However, you must still report ALL income on your tax return, even without a 1099. Keep your own records of earnings from the Flex app.
Can I switch between mileage rate and actual expenses each year?
If you use the standard mileage rate in the first year you use a car for business, you can switch methods in later years. However, if you start with actual expenses, you may be locked into that method. The rules are complex - consult IRS Publication 463 or a tax professional.
Are tips taxable income?
Yes, tips are taxable income. Amazon Flex tips (from Whole Foods, Prime Now, etc.) should be included in your total earnings. They're typically reported on your 1099-NEC, but even cash tips must be reported.
Can I deduct meals while working?
Generally, no. Meals are considered personal expenses unless you're traveling overnight for business. Grabbing lunch during your block is not deductible, even though you're working.
Do I need to pay state taxes too?
It depends on your state. Most states have income tax and you'll owe state self-employment tax. However, Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming have no state income tax.
Should I form an LLC for Amazon Flex?
For most Amazon Flex drivers, an LLC is unnecessary. A single-member LLC doesn't change your tax situation (you still file Schedule C). It may provide some liability protection, but adds cost and complexity. Consult a business attorney if you have specific liability concerns.
When to Hire a Tax Professional
While many Flex drivers can handle their taxes with good software, consider hiring a CPA or Enrolled Agent if:
Pro Tip: When looking for a tax professional, seek someone who specializes in self-employment or gig economy taxes. They'll know the specific deductions and strategies that apply to you. The cost of a good CPA ($200-500) often pays for itself in additional deductions found.
Start Tracking Today, Save Thousands Tomorrow
The biggest tax mistake is not keeping records. Download a mileage tracking app right now and start logging every business mile. Your future self will thank you at tax time.
About Glen Meade
Founder of FlexDriverGuide and SideQuestHustle.com. I've spent years researching gig economy platforms and interviewing hundreds of drivers to bring you strategies that actually work. My goal is to help you maximize your earnings while avoiding common pitfalls.