Instacart Shopper Taxes in Maine - 2025 Guide

Updated for 2025 (Filing 2024 Taxes)

Is Instacart Shopper income taxable in Maine?

Yes, absolutely. Income earned as an Instacart shopper is taxable at both the federal and Maine state levels. Because Instacart treats you as an independent contractor, not an employee, you are considered self-employed by the IRS and the State of Maine.

Federal Requirements: You'll report your Instacart earnings on Schedule C (Profit or Loss from Business) when you file your federal income tax return (Form 1040). This form allows you to deduct business expenses, ultimately determining your taxable profit. Keep detailed records of all income received from Instacart (typically found in your Instacart earnings summary).

Maine Specific Rules: Maine has a graduated income tax system. This means the tax rate you pay increases as your taxable income increases. Your Instacart profit (after deducting business expenses on Schedule C) will be added to your other income, and then taxed according to Maine’s income brackets for the 2024 tax year. You'll use Maine Form 1040-ME to calculate your Maine income tax liability. Maine also has a standard deduction and itemized deduction options, similar to the federal system.

Top Tax Write-offs for Instacart Shoppers

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

• Mileage: This is often the largest deduction! For 2024, the standard mileage rate is 67 cents per mile for business use of your vehicle. Keep a detailed mileage log (date, destination, business purpose, miles driven). You can use apps to help track this.
• Hot Bags & Shopping Equipment: The cost of insulated bags, shopping carts, phone mounts, or any other equipment specifically used for Instacart shopping is deductible.
• Smartphone & Data Plan (Partial): If you use your smartphone and data plan for Instacart, you can deduct the percentage of the expense attributable to business use. For example, if you use your phone 50% for Instacart, you can deduct 50% of your monthly bill.
• Instacart Shopper Software/Apps: Any subscription fees or costs associated with apps or software used specifically to manage your Instacart business (beyond the standard smartphone plan) are deductible.

The 15.3% Self-Employment Tax Surprise

Many independent contractors are surprised by self-employment tax. 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 calculated on Schedule SE (Self-Employment Tax). However, you only pay self-employment tax on profits over $400. The good news is you can deduct one-half of your self-employment tax from your adjusted gross income on Form 1040, which reduces your overall income tax liability.

Closing Tip for Maine Residents

Tax laws can be complex, and this is a general guide. I strongly recommend keeping meticulous records of all your income and expenses throughout the year. Consider using accounting software designed for freelancers. For personalized advice tailored to your specific situation, especially regarding Maine’s graduated tax rates and potential credits, consulting with a qualified tax professional in Maine is always a wise investment. Good luck with your Instacart business and filing your 2024 taxes!