Calculate your quarterly estimated taxes as a gig worker. Avoid the IRS underpayment penalty — know exactly what to send each quarter.
Self-Employment Tax (15.3%): Covers Social Security (12.4%) + Medicare (2.9%). This applies to 92.35% of your net earnings. Employees only pay half — you pay both halves.
Quarterly payments: If you'll owe $1,000+ at year-end, the IRS requires quarterly estimated payments. Missing them triggers penalties (~7% annualized).
Deductible expenses: Mileage (67 cents/mile for 2024), phone (business %) , equipment, platform fees, and home office can all reduce your tax bill.
Rule of thumb: Set aside 25–30% of every gig payment for taxes. More if you're in a high-income-tax state.