DoorDash Dasher Taxes in Alabama - 2025 Guide

Updated for 2025 (Filing 2024 Taxes)

Is DoorDash Dasher income taxable in Alabama?

Yes, absolutely. Income earned as a DoorDash Dasher is taxable at both the federal and Alabama state levels. The IRS considers you self-employed, meaning you're essentially running your own business. This has implications for how you report your income and pay taxes.

Federal Taxes: You'll report your DoorDash earnings on Schedule C (Profit or Loss From Business) as part of your Form 1040. This form allows you to deduct business expenses (more on that below) to arrive at your taxable profit. Even if you receive a 1099-K from DoorDash, it's your responsibility to accurately report all income, even if it's less than the 1099-K threshold.

Alabama State Taxes: Alabama has a graduated income tax system. This means the tax rate you pay increases as your income increases. Your DoorDash profit (after deducting business expenses on your federal Schedule C) will be used to calculate your Alabama income tax liability. You'll file Form A-4 to determine your Alabama tax obligation. The specific tax brackets for 2024 (filing in 2025) will be available on the Alabama Department of Revenue website (https://revenue.alabama.gov/). You'll need to determine which bracket your taxable income falls into to calculate your state tax.

Top Tax Write-offs for DoorDash Dashers

As a self-employed Dasher, you can significantly reduce your tax bill by claiming eligible business deductions. Here are some key write-offs:

• Mileage: This is often the biggest deduction! For 2024, the standard mileage rate is 67 cents per mile for business use. Keep a detailed log of all miles driven while "on duty" – from when you accept a delivery request until you return to being available for new requests. Apps like Stride Tax or Everlance can help with this.
• Phone Expenses: You can deduct the portion of your cell phone bill that relates to your DoorDash work. If you use your phone solely for DoorDash, you can deduct the entire bill. Otherwise, you'll need to calculate the percentage of time you use it for business.
• Hot Bags & Equipment: The cost of items like insulated delivery bags, phone mounts, dash cams, and even a portion of your vehicle maintenance (oil changes, tires – based on business use percentage) are deductible.
• DoorDash Software/Subscription Fees: Any fees you pay for apps or services specifically used to help you Dash (e.g., tax preparation software focused on gig workers) are deductible.

The 15.3% Self-Employment Tax Surprise

When you're an employee, your employer pays half of your Social Security and Medicare taxes. As a self-employed individual, you're responsible for both the employer and employee portions – a total of 15.3%. This is called self-employment tax.

You'll calculate this on Schedule SE (Self-Employment Tax). The good news is you only pay self-employment tax on your profit (income minus expenses). Also, you don't pay self-employment tax on the portion of your earnings that exceeds the Social Security wage base (which changes annually – for 2024, it's $168,600). You do pay Medicare tax on all self-employment income.

Closing Tip for Alabama Residents

Navigating self-employment taxes can be complex. I strongly recommend keeping meticulous records of your income and expenses throughout the year. Consider using accounting software or a dedicated app to simplify tracking. Don't hesitate to consult with a qualified tax professional (like myself!) to ensure you're taking all eligible deductions and complying with both federal and Alabama tax laws. Proactive tax planning can save you significant money and stress come tax season. Good luck and safe dashing!