What Is a 1099-K? A Guide for Delivery and Rideshare Drivers

A 1099-K is a form that reports the gross payments a platform processed for you during the year, and for tax year 2026 a platform only has to send one if it processed more than $20,000 in payments AND more than 200 transactions for you.

Sources: IRS, FAQs on the Form 1099-K threshold under the One, Big, Beautiful Bill (threshold reverts to $20,000 and 200 transactions for 2025 and later); IRS, Understanding your Form 1099-K; IRS, 2026 business standard mileage rate set at 72.5 cents per mile. Verified July 2026.

What a 1099-K actually is

A 1099-K is an information return. A payment network - the company that moves money from a customer to you - files it with the IRS and sends you a copy. It reports the gross amount that ran through the platform in your name, month by month, plus the number of transactions.

Two things matter here. First, it is not a bill. It is a record. Second, "gross" means the total before anything was taken out. If a customer paid $12 for a delivery and the platform kept a fee, the 1099-K can still show the full $12. That is why the number on the form is usually bigger than what actually landed in your bank account.

The 2026 threshold, and why it keeps moving

For tax year 2026 (the return you file in early 2027), a third-party payment network only has to send you a 1099-K if it processed more than $20,000 in payments and more than 200 transactions for you. Both numbers have to be crossed, not just one.

The reason drivers are confused is that this figure has changed several times. The American Rescue Plan Act had dropped the trigger to $600 with no transaction minimum. The IRS delayed that, then phased in $5,000 for 2024 and $2,500 for 2025. Then the law changed again: the One, Big, Beautiful Bill restored the old $20,000-and-200-transaction threshold for 2025 and later years. So the low $600 rule you may have read about never took full effect.

• Old rule (pre-2022): more than $20,000 and more than 200 transactions.
• American Rescue Plan target: $600, no transaction floor - delayed, then replaced.
• Now, for 2025 and 2026: back to more than $20,000 and more than 200 transactions.

Because the threshold is high again, many part-time drivers will not get a 1099-K at all. That does not change what you owe. More on that below.

1099-K vs 1099-NEC for drivers

Drivers often get one of these forms, sometimes both, and they are not the same.

A 1099-K reports money a platform processed on behalf of customers, such as the fares riders paid you through a rideshare app. A 1099-NEC reports nonemployee compensation the company paid you directly, such as bonuses, referral pay, and incentives. For 2026, a company generally issues a 1099-NEC once that direct pay reaches $2,000 (the One Big Beautiful Bill raised this from $600, effective for payments made on or after January 1, 2026).

How this shows up depends on the platform. Rideshare companies like Uber and Lyft commonly send a 1099-K for rider fares and a 1099-NEC for incentives and referrals. Some delivery platforms pay drivers as direct nonemployee compensation and lean on the 1099-NEC instead. The forms differ, but the bottom line is identical: it is all self-employment income, and it all goes on your return.

You owe tax even without a form

This is the part that trips people up. The 1099-K is a reporting trigger for the platform, not the definition of your income. If you earned money driving, that income is taxable whether or not a form ever arrives in the mail.

So if you made $8,000 across two apps and neither one crossed the $20,000-and-200 threshold, you still report that $8,000. The IRS expects you to report all your income from self-employment, and you file it on Schedule C. Waiting for a form you may never receive is how drivers end up under-reporting by accident.

What to do when you get one

1. Check the gross figure against your own records. The form shows gross payments, so it will likely be higher than your take-home. That is expected.
2. Do not subtract fees by guessing. Report the gross, then deduct your real business expenses separately on Schedule C.
3. Watch for double-counting. If you got both a 1099-K and a 1099-NEC, make sure the same dollars are not counted twice.
4. If a number is wrong, contact the platform that issued it and ask for a corrected form. Keep the emails.
5. Keep the form with your tax records. You do not attach it to your return, but you want it if a question comes up later.

How mileage deductions offset the income

Here is where the gross number stops being scary. As a self-employed driver you can deduct your business miles. For 2026 the IRS standard mileage rate is 72.5 cents per mile, up from 70 cents in 2025. You multiply your business miles by that rate and subtract it from your income. You are taxed on the profit that is left, not the gross.

Worked example. Say your 1099-K shows $24,000 in gross fares and you drove 20,000 business miles over the year:

• Gross reported on the 1099-K: $24,000
• Mileage deduction: 20,000 miles x $0.725 = $14,500
• Taxable profit before other expenses: $24,000 - $14,500 = $9,500

That is a $14,500 difference driven entirely by mileage. But the deduction is only worth what you can prove. The IRS expects a contemporaneous log - dates, miles, and business purpose - not a number you reconstruct in April. If you cannot back up the miles, you cannot safely claim them.

Common questions

Do I report income if I never got a 1099-K?

Yes. The form is the platform's reporting duty, not the source of your obligation. All self-employment income is reportable whether or not a 1099-K, 1099-NEC, or any form arrives.

Why is my 1099-K bigger than what I was paid?

Because it reports gross payments before platform fees and commissions. You claim those costs and your mileage as deductions rather than expecting them to be netted out on the form.

Can I take the mileage deduction and still keep the standard deduction?

Generally yes. The business mileage deduction is a business expense on Schedule C, which is separate from the personal standard deduction on your main return. Tax situations vary, so confirm your own case with a tax professional.

The mileage deduction is the biggest lever a driver has, and it only holds up if the log does. TruMile records every business drive automatically in the background, so the miles behind that deduction are already documented before tax season. See how automatic tracking works for delivery drivers.

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