Instacart Shopper Taxes in Mississippi - 2025 Guide

Updated for 2025 (Filing 2024 Taxes)

Is Instacart Shopper income taxable in Mississippi?

Yes, absolutely. Income earned as an Instacart shopper is taxable at both the federal and Mississippi state levels. Because Instacart treats you as an independent contractor, not an employee, you are responsible for reporting your earnings and paying all applicable taxes.

Federal Requirements: You'll report your Instacart income on Schedule C (Profit or Loss from Business) when you file your federal income tax return (Form 1040). Schedule C allows you to deduct business expenses, reducing your taxable income. You’ll calculate your net profit (income minus expenses) on Schedule C, and that profit is then transferred to your Form 1040.

Mississippi Specific Rules: Mississippi has a flat income tax rate of 5% for the 2024 tax year (filing in 2025). Your net profit from Schedule C will be included in your Mississippi income tax calculation. You’ll file Mississippi Form 80-105, Individual Income Tax Return, to report your income and calculate your state tax liability. Mississippi does not offer a state-level deduction for federal income tax paid, so your federal adjusted gross income (AGI) is the starting point for your state return.

Top Tax Write-offs for Instacart Shoppers

As an Instacart shopper, you have several potential tax deductions that can significantly lower your tax bill. Keep excellent records of all expenses!

• Mileage: This is often the largest deduction. For 2024, the standard mileage rate is 67 cents per mile for business use. You’ll need to track all miles driven for Instacart shopping (from the time you accept a batch until you deliver it and return to a starting point). You can use an app or a mileage log. You cannot include commuting miles.
• Smartphone & Data Plan: If you use your smartphone and data plan primarily for Instacart work, you can deduct the portion of the expenses attributable to your business. If you use it for personal use as well, you can only deduct the business percentage.
• Hot Bags & Shopping Equipment: The cost of insulated bags, shopping carts, or other equipment specifically used for Instacart shopping is deductible. If the item has a useful life of more than one year (like a cart), you may need to depreciate it over several years.
• Instacart Shopper Software/Apps: Any subscription fees or costs associated with apps or software used to manage your Instacart business (beyond your smartphone's basic operating system) are deductible.

The 15.3% Self-Employment Tax Surprise

Because you're an independent contractor, you're responsible for paying both the employer and employee portions of Social Security and Medicare taxes. This is called self-employment tax. The combined rate is 15.3% (12.4% for Social Security and 2.9% for Medicare) on your net earnings from Schedule C. However, you only pay self-employment tax on earnings over $400.

You’ll calculate this on Schedule SE (Self-Employment Tax). The good news is that you can deduct one-half of your self-employment tax from your gross income on Form 1040, which reduces your overall tax liability.

Closing Tip for Mississippi Residents

Tax laws can be complex, and this information is for general guidance only. I strongly recommend keeping meticulous records of all your income and expenses throughout the year. Consider using accounting software designed for independent contractors. If you're unsure about any aspect of your taxes, or if your situation is particularly complex, consulting with a qualified tax professional in Mississippi is always a wise investment. Wishing you a profitable and tax-efficient year as an Instacart shopper!