Instacart Shopper Taxes in Pennsylvania - 2025 Guide

Updated for 2025 (Filing 2024 Taxes)

Is Instacart Shopper income taxable in Pennsylvania?

Yes, absolutely. Income earned as an Instacart shopper is taxable at both the federal and Pennsylvania 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 profit (income minus expenses) on Schedule C, and that profit is then transferred to your Form 1040.

Pennsylvania Requirements: Pennsylvania has a flat income tax rate of 3.07% for the 2024 tax year. You will report your Schedule C profit on your Pennsylvania income tax return (Form PA-1040). The flat rate means all of your taxable income is taxed at the same percentage, simplifying the state tax calculation. You'll need to calculate your PA taxable income based on your federal AGI (Adjusted Gross Income) with certain PA-specific adjustments.

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 biggest 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 accepting a batch to dropping off the order). You can use an app or a mileage log. You cannot include commuting miles.
• Smartphone & Data Plan: If you use your smartphone for Instacart (and most shoppers do!), you can deduct the portion of your phone bill and data plan that relates to your work. If you use your phone 100% for Instacart, you can deduct the entire amount. Otherwise, calculate the percentage of time you use it for work.
• 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 specifically for managing your Instacart business (beyond the standard Instacart app) 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 up to the annual wage base, and 2.9% for Medicare). You'll calculate this on Schedule SE (Self-Employment Tax).

The good news is you only pay self-employment tax on your profit (after deducting business expenses on Schedule C). Also, you can deduct one-half of your self-employment tax from your gross income on Form 1040, which reduces your overall tax liability.

You don't pay self-employment tax on earnings below $400, but you still need to file if your total income exceeds the standard deduction.

Closing Tip for Pennsylvania 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 freelancers or consulting with a qualified tax professional (like myself!) to ensure you're taking all the deductions you're entitled to and complying with all Pennsylvania and federal tax regulations. Proper planning can save you significant money and stress during tax season. Good luck, and happy shopping!