Quick answer
US freelancers on Upwork and Fiverr are self-employed. Platforms don’t withhold tax, so you report earnings on Schedule C and pay income tax plus 15.3% self-employment tax on net profit.
- You get a 1099-K if client payments are over $20,000 and over 200 transactions in the year, or you live in a state with a lower threshold.
- Upwork’s 1099-K shows gross payments, before its 0% to 15% freelancer service fee. You report the gross and deduct the fees.
- Fiverr keeps about 20% of each order. Check whether your records show gross or net before you deduct.
- No 1099-K? You still report every dollar.
When you get a 1099-K
For 2026, the federal 1099-K rules for platforms are:
| Condition | Result |
|---|---|
| Over $20,000 in payments and over 200 transactions | 1099-K issued |
| Below either number | No federal 1099-K required |
| State with a lower threshold | 1099-K may be issued at a lower amount |
| Backup withholding applied | 1099-K issued |
Upwork lists states with lower thresholds, including Arkansas, Illinois, Maryland, Massachusetts, Mississippi, Missouri, Montana, New Jersey, Vermont, Virginia and Washington, D.C. Rules change, so check the platform’s current help page. See 1099-K Threshold 2026.
Most high-earning Upwork freelancers have fewer than 200 transactions, because hourly contracts pay weekly. So many freelancers earning $50,000 or more get no 1099-K. That doesn’t change what you owe.
Why not a 1099-NEC?
Upwork and Fiverr process payments as a third party, so clients generally don’t send you a 1099-NEC for platform work. The platform handles any reporting. See 1099-NEC vs MISC vs K.
Gross vs net: getting the fees right
This is where most mistakes happen.
| Step | Upwork example |
|---|---|
| Client pays for your work | $1,000 |
| Upwork service fee (10% in this example) | $100 |
| You receive | $900 |
| Report as income on Schedule C | $1,000 |
| Deduct as fees | $100 |
If you report only what reached your bank ($900) and the 1099-K shows $1,000, the IRS computer sees underreported income. Report gross and deduct fees, and your return matches.
If a platform statement already shows net earnings, and no 1099-K reports gross, you can report net. Just don’t deduct the fee twice. Pick one method and keep the statements that support it.
Your annual earnings report in each platform shows gross, fees and net. Download it every January.
Deductions for platform freelancers
| Expense | Notes |
|---|---|
| Upwork and Fiverr service fees | Commissions and fees |
| Upwork Connects, Freelancer Plus membership | Advertising or other expenses |
| Fiverr Promoted Gigs, Seller Plus | Advertising |
| Withdrawal and currency conversion fees | Bank and payment fees |
| Laptop, monitor, software | De minimis up to $2,500 per item, or Section 179 |
| Home office | Home Office Deduction |
| Internet and phone | Business-use %. See Deduct Phone and Internet |
| Subcontractors you hire | 100% |
| Courses that improve your current skills | 100% |
| Health insurance | Self-Employed Health Insurance Deduction |
For the full list, see Self-Employed Tax Deductions. Designers and developers can also see Tax Deductions for Designers and Developers.
Worked example
Tom is a freelance copywriter. In 2026 he earns on both platforms. He is single with no other job.
| Item | Amount |
|---|---|
| Upwork client payments (gross) | $40,000 |
| Fiverr orders (gross) | $10,000 |
| Gross receipts | $50,000 |
| Upwork service fees (10%) | $4,000 |
| Fiverr fees (20%) | $2,000 |
| Connects | $300 |
| Laptop | $1,400 |
| Software | $500 |
| Home office, simplified (200 sq ft) | $1,000 |
| Total expenses | $9,200 |
| Net profit | $40,800 |
Tom’s self-employment tax is about $5,765. His federal income tax is about $1,846 after the standard deduction ($16,100), half of SE tax and the QBI deduction. Total: about $7,611, or roughly 19% of profit.
He had fewer than 200 Upwork payments, so he got no 1099-K. He still reports all $50,000. Test your own numbers in the Self-Employment Tax Calculator.
Paying tax during the year
With no withholding, you should pay quarterly estimated taxes once you expect to owe $1,000 or more. The due dates are April 15, June 15, September 15 and January 15. See Quarterly Estimated Taxes and How to Pay Estimated Taxes Online.
A simple habit: every time you withdraw from Upwork or Fiverr, move 25% to a tax savings account. See How Much Should I Set Aside for Taxes as a 1099 Contractor?.
Keep platform records
Download your annual earnings report from each platform every January. Save monthly statements too. They show gross billings, fees, refunds and withdrawals, which is exactly what you need to reconcile a 1099-K or support income with no form.
Your W-9
Both platforms require US freelancers to submit a W-9. If your name and taxpayer ID don’t match IRS records, the platform may start 24% backup withholding. See How to Fill Out a W-9.
Frequently asked questions
Do I have to pay taxes on Upwork if I don’t get a 1099?
Yes. All freelance income is taxable. SE tax applies once net profit from all self-employment reaches $400.
Are Upwork fees tax deductible?
Yes. Service fees, Connects and membership fees are business expenses when you report gross income.
Is my 1099-K amount what I owe tax on?
No. It’s gross payments. You owe tax on profit after fees and other expenses.
I’m a US citizen living abroad. Do the same rules apply?
You still file a US return and generally owe SE tax, though foreign earned income rules may reduce income tax. See Get Paid by International Clients for payment tips.
This article is general information, not tax advice. Consult a CPA or Enrolled Agent for your situation.
Related guides
- Gig Worker Taxes: The Complete Guide for Uber, DoorDash and Instacart
- DoorDash Taxes: How Much Dashers Owe and What They Can Deduct
- Uber and Lyft Driver Tax Deductions
- Etsy Seller Taxes: 1099-K, Sales Tax and Deductions
About this guide
Written by the Freelancer Tax HQ editorial team, based on our professional experience, official US government sources (IRS, SSA and other agencies) and reputable informational articles listed in the sources below. Last reviewed on . Tax rules change often, and we update this guide when they do. Read our editorial policy or report an error.
Sources
Upwork: Report income as a U.S. freelancer; Upwork: Freelancer Service Fee; Fiverr: W-9 collection; IRS: Understanding your Form 1099-K; IRS: 2026 tax inflation adjustments. Example figures are FreelancerTaxHQ illustrations.
Official resources linked in this guide: IRS: Backup withholding; IRS: About Form 1099-K; IRS: Tax preparer credentials; IRS: Estimated Taxes; IRS: About Form W-9.