Washington Gig Worker Tax Calculator
Washington does not tax ordinary income — not wages, not self-employment profit. A gig driver in Washington owes no state income tax on gig earnings. What the state does have is a narrowly drawn excise tax on certain long-term capital gains, which sounds relevant to a tax question and is not, because Schedule C profit is ordinary income rather than capital gain.
That distinction trips people up in both directions: some drivers assume the capital gains tax means Washington has income tax after all, and others assume "no income tax" means they owe nothing. The federal bill on the worked example below is 15.1% of gross, and it is not small.
What a Washington gig driver actually owes in 2026
A driver grosses $48,500, drives 6,000 business miles in each half, claims no other vehicle costs and files as single. Every figure comes from the same engine that powers the calculator, computed in your browser.
| Line | How it is derived | Amount |
|---|---|---|
| Gross 1099 income | Fares, tips and promotions | $48,500.00 |
| Mileage shield | 6,000 × $0.725 + 6,000 × $0.760 | −$8,910.00 |
| Schedule C net profit | Gross less the mileage deduction | $39,590.00 |
| Self-employment tax | 15.3% applied to 92.35% of net profit | $5,593.89 |
| Adjusted gross income | Net profit less half of SE tax | $36,793.06 |
| Federal taxable income | AGI less the $16,100 standard deduction less QBI | $16,554.44 |
| Federal income tax | The 10% and 12% federal bands | $1,738.53 |
| Washington income tax | No state income tax on self-employment profit | $0.00 |
| Total 2026 liability | SE tax + federal income tax | $7,332.42 |
| Quarterly set-aside | Total divided by four | $1,833.11 |
The capital gains excise tax is not what you think
Washington's capital gains excise tax is the single most misunderstood item in the state's tax code for self-employed people, so it is worth being precise about it.
- It is an excise tax, not an income tax. That framing is why it survived the legal challenges that would apply to a general income tax in Washington.
- It reaches long-term capital gains only. Selling stock or a business interest at a profit is the target. Driving passengers or delivering food is not.
- Your Schedule C profit is ordinary income. Gig earnings are business income, not capital gain, and no amount of it converts into capital gain through the act of driving.
- There is a large standard deduction before the tax applies at all, which further narrows its reach.
So the practical answer for a gig driver is: this tax does not apply to your gig earnings. It could apply if you sold appreciated investments or disposed of a business interest, and that is a separate conversation outside an income tax estimator.
Where Washington does collect
Business and occupation tax
Washington levies a gross receipts tax called business and occupation tax, and it applies to business activity in the state. It is measured on gross receipts rather than on net profit, which is a fundamentally different base from an income tax. Whether and how it reaches a particular gig driver depends on classification and thresholds, and it is not part of what this income tax estimator models. Drivers in Washington should check their position directly rather than assuming the absence of income tax means no state business tax at all.
Sales tax and the retail level
Washington has a substantial state and local sales tax. As with other states, the question of whether a delivery or transport service is taxable depends on the specific service and how the platform structures it, and platforms often handle it. That is a transaction-tax question, not an income one.
Property and vehicle levies
Vehicle registration in Washington includes a range of fees and local levies, and the state has experimented with road usage charging. These are costs of operating rather than deductible income taxes, and the standard mileage rate already accounts for the vehicle's general running costs when you use it.
Paying the IRS from Washington
The four federal estimated payment deadlines are April 15, June 15, September 15 and January 15, moving to the next business day when a date lands on a weekend or a federal holiday. The January 2027 date settles the final quarter of 2026, which catches out drivers who think of it as a new-year payment.
The absence of a state return means a Washington driver's entire compliance picture is federal, and that is actually a simplification worth using: one set of quarterly payments, one Schedule C, one Schedule SE. If you hold a W-2 job too, the calculator stacks the two, gives your W-2 wages first claim on the Social Security wage base, and shows the marginal cost of each additional gig dollar.
What this Washington estimate leaves out
- Business and occupation tax on gross receipts, which may apply depending on your classification and volume.
- The capital gains excise tax on assets outside your gig operation.
- Sales tax on any taxable service or good you sell.
- The excess business loss limitation. The calculator offsets a gig loss against other income and flags it, but does not apply the statutory annual cap.
- Above-threshold QBI limits. Above roughly $201,750 single, $201,750 head of household, or $403,500 married of taxable income the federal QBI deduction is additionally limited by W-2 wages and vehicle basis. The calculator flags the threshold crossing without applying the limitation.
- Credits other than the Child Tax Credit.
Washington gig worker questions
Is Washington really a no-income-tax state for drivers?
For your gig profit, yes. Washington taxes neither wages nor self-employment income, so a driver's Schedule C profit faces no state income tax. The state's capital gains excise tax is real but is confined to long-term capital gains on assets, which is not where gig profit lives. The important consequence is that all of your tax planning leverage is federal: mileage, write-offs, the QBI deduction, retirement contributions and health insurance.
Do I need to worry about the business and occupation tax?
It is worth checking rather than assuming. The B&O tax is measured on gross receipts with classification-specific rates and an annual threshold below which no tax is due. Because it is a gross receipts tax, it behaves quite differently from income tax and can apply in a year you show little or no profit. This estimator is an income tax tool and does not compute it.
Since there is no state tax, should I still keep mileage records in Washington?
More so, if anything. Mileage is the largest single lever on a driver's federal bill, and if your entire bill is federal then mileage is your only significant lever. On this example the 6,000 + 6,000 business miles remove $8,910.00 from taxable income, cutting both self-employment tax and income tax — a federal saving of about $2,054. Losing those records costs you federal dollars with no state offset to recover them.
Does the Seattle area add a local income tax?
Not an income tax on your gig earnings. Washington's constitution restricts a graduated net income tax, and attempts to impose local income taxes have been litigated. Seattle does levy other business-related taxes, and those are separate from income tax and outside this estimator.
Other states
Washington is one of twelve states covered in depth. Each page shows the same scenario so the jurisdictions are directly comparable.