Does a mileage deduction mean I get 76 cents back per mile?

What a mile is actually worth

For a self-employed driver, two taxes are in play. Income tax at your marginal bracket, and self-employment tax at 15.3% (12.4% Social Security plus 2.9% Medicare), which applies to 92.35% of net earnings. A business deduction reduces net earnings, so it reduces both.

Rough worth of one mile deducted at 76¢, by bracket:

These are estimates combining the bracket with SE tax on the 92.35% base. They are meant to correct an order-of-magnitude error, not to be filing figures.

Why this still matters enormously

Twenty cents a mile is not 76 cents, but across 18,000 business miles it is still roughly $3,600 of tax you do not pay. The deduction is one of the largest levers a gig driver has. The point is not that it is small — it is that budgeting as though it were a 76¢-per-mile rebate will leave you badly short at filing time.

The related error: gross pay is not profit

The same confusion runs the other way on the income side. A driver who sees $22/hour on a platform dashboard is looking at gross revenue before fuel, before the real cost of wearing out the vehicle, and before the 15.3% self-employment tax. AAA's Your Driving Costs puts the all-in cost of owning and operating a new vehicle at roughly 66¢ to $1.00 per mile depending on annual mileage. See what a mile really costs you.