Your Real DoorDash Hourly Rate (After Gas and Wear)
The app shows you gross. Here is how to figure out what you actually make.
Gig food delivery looks attractive when the app says you made $22 in an hour. The app is showing you gross. Your real hourly rate has to subtract the cost of getting there. Once you do, the picture is much different.
The formula
Real hourly = (gross earnings - gas - depreciation - taxes) / hours worked
Each of those subtractions is bigger than people expect.
Gas
Delivery drivers report driving 25-40 miles per active hour. At 28 mpg and $3.40/gallon, that is roughly $3.50-$5.00 of gas per hour. Drive a less fuel-efficient car and the number goes up.
Wear, tear, and depreciation
The IRS standard mileage rate for 2026 is 67 cents per mile. That number includes everything - fuel, maintenance, tires, brakes, and depreciation - and is widely considered a reasonable estimate of the true per-mile cost. At 30 miles per active hour, that is roughly $20 per hour of wear and tear.
Drivers regularly ignore depreciation because the bill is invisible until they need a transmission or a clutch. By then the math has already happened.
Self-employment taxes
You are not a W-2 employee. You are a 1099 contractor. That means:
- No federal or state tax is withheld.
- You owe self-employment tax (15.3% for Social Security + Medicare).
- You owe federal and state income tax on top of that.
The mileage deduction (currently 67 cents/mile) is your single biggest offset against the gross. Track every mile.
Concrete example
You drove for 4 hours, completed 14 deliveries, drove 120 miles total, and earned $88 in payouts and tips.
- Gross: $88
- Minus IRS-rate vehicle cost (120 mi x $0.67): -$80
- True margin BEFORE income tax: $8 total, or $2/hour
Some hours and markets are better. Some are dramatically worse.
Track everything
Use an app like Stride, MileIQ, or Everlance to track miles. Tracking miles is the single biggest factor in whether gig delivery is profitable at tax time.
When delivery does pay
- Dense urban areas with short trip distances.
- Surge / peak pay windows during meal rushes, bad weather, sports events.
- Hybrid or electric vehicles with lower per-mile costs.
- People who would be at the wheel anyway (commuters between work and home, errand drivers).
Alternatives that often pay better
- Most direct part-time jobs at $15-$18/hour - the W-2 wage is net of vehicle costs.
- Local freelancing in a skill you already have.
- Reselling on eBay or Mercari from a closet purge.
Delivery is not bad work. It is just not the high-margin work the app implies. Do the real math before treating it as a primary income strategy.
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