Instacart Shopper Taxes in Utah - 2025 Guide

Updated for 2025 (Filing 2024 Taxes)

Is Instacart Shopper income taxable in Utah?

Yes, absolutely. Income earned as an Instacart shopper is taxable at both the federal and Utah state levels. Because Instacart classifies 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 net profit is then transferred to your Form 1040.

Utah Specific Rules: Utah has a flat income tax rate of 4.85% for the 2024 tax year (filing in 2025). This means regardless of your income level, you’ll pay 4.85% of your taxable income to the state of Utah. Your federal adjusted gross income (AGI) is the starting point for calculating your Utah taxable income, and you’ll use Form TC-1040 to file your Utah state income tax return. Like the federal return, deductions claimed on Schedule C will reduce your Utah taxable income as well.

Top Tax Write-offs for Instacart Shoppers

As an Instacart shopper, you have several potential tax deductions that can significantly lower your tax bill. Here are a few key ones:

• Mileage: This is often the biggest deduction! The IRS standard mileage rate for 2024 is 67 cents per mile for business use. Keep a detailed log of all miles driven for Instacart deliveries (from leaving to pick up the order to delivering it). You can use an app or a simple notebook.
• Hot Bags & Equipment: The cost of insulated bags, phone mounts, car chargers, and other equipment used specifically for Instacart shopping are deductible. If the item has a useful life of more than one year (like a phone mount), you may need to depreciate it over several years.
• Smartphone & Data Plan (Partial): If you use your smartphone and data plan for Instacart, you can deduct the percentage of the cost attributable to business use. For example, if you use your phone 75% for Instacart, you can deduct 75% of your monthly bill.
• Instacart Shopper App Fees/Software: Any fees paid directly to Instacart for access to the shopper app or for any related software used to manage your business 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 helps reduce your overall tax liability.

Closing Tip for Utah Residents

Don't wait until the last minute! Keeping accurate records of your income and expenses throughout the year will make tax time much easier. Consider using accounting software or a spreadsheet to track your mileage, expenses, and earnings. If you're unsure about any aspect of your taxes, consulting with a qualified tax professional in Utah is always a wise investment. Good luck, and happy shopping!