Instacart Shopper Taxes in South Carolina - 2025 Guide

Updated for 2025 (Filing 2024 Taxes)

Is Instacart Shopper income taxable in South Carolina?

Yes, absolutely. Income earned as an Instacart shopper is taxable at both the federal and South Carolina 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 South Carolina.

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 net profit (or loss). It's crucial to keep accurate records of all income and expenses throughout the year.

South Carolina Requirements: South Carolina has a graduated income tax system, meaning the tax rate you pay increases as your income increases. Your net profit from Schedule C will be included in your Adjusted Gross Income (AGI) on your South Carolina income tax return (Form SC1040). You'll then use the SC tax brackets to calculate your state income tax liability. The SC Department of Revenue website (dor.sc.gov) provides the most up-to-date tax brackets and forms.

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. Keep a detailed mileage log (date, destination, business purpose, miles driven). You can use apps to help with 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.
• Phone Expenses: If you use your personal phone for Instacart, you can deduct the percentage of the phone bill attributable to business use. Keep records of your phone usage.
• Software & App Fees: Any fees paid for apps or software used to manage your Instacart business (e.g., mileage tracking apps, expense trackers) 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, which can lower your overall tax liability.

Closing Tip for South Carolina Residents

Tax laws can be complex, and this guide provides general information. I strongly recommend keeping meticulous records of all your income and expenses throughout the year. Consider using accounting software or working with a qualified tax professional, especially as your Instacart income grows. The South Carolina Department of Revenue (dor.sc.gov) is an excellent resource for state-specific tax information. Proactive planning and accurate record-keeping will help ensure you comply with all tax requirements and maximize your deductions.