{"slug":"upwork","name":"Upwork","category":"freelance","workerTerm":"freelancers (and agencies)","classification":"Upwork tells clients to determine the proper classification of their U.S. freelancers under IRS and state rules. A client who decides a worker is an employee can use Upwork Payroll, where a staffing provider acts as the employer and issues a W-2.","taxForms":"Upwork's escrow subsidiary acts as a third party settlement organization and issues Form 1099-K to U.S. freelancers who meet the federal threshold (for 2026, more than $20,000 and more than 200 transactions), had U.S. tax withheld, or live in a lower-threshold state. Clients don't issue 1099-NEC or 1099-MISC; Upwork issues a 1099-NEC only in limited cases, such as work done for Upwork itself, and Upwork Payroll workers get a W-2.","platformFees":"A Freelancer Service Fee of 0% to 15% per contract, shown before you propose or accept and locked once the contract starts (Enterprise clients typically 10%; Direct Contracts 5% on Basic or 0% with Freelancer Plus). Optional Freelancer Plus costs $19.99 per month and extra Connects cost $0.15 each.","payouts":"Hourly earnings become available the Wednesday 10 days after the weekly billing period, and fixed-price funds clear 5 days after client approval. Freelancers with a U.S. tax address can withdraw by free direct-to-bank ACH, Instant Pay ($2), U.S. dollar wire ($50) or PayPal.","deductions":["Upwork's 0%-15% Freelancer Service Fee (Upwork notes these fees may be deductible)","Freelancer Plus membership ($19.99 per month)","Connects bought to submit proposals ($0.15 each), including any sales tax charged","Withdrawal fees such as Instant Pay ($2) or wire transfers ($50)","Computer, software and internet costs used for Upwork contracts","Home office space used regularly and exclusively for freelance work"],"watchOuts":["Your 1099-K shows total payments from clients before Upwork's fees, not your net withdrawals, so deduct the service fee separately.","For tax year 2025 Upwork listed Arkansas, Illinois, Maryland, Massachusetts, Mississippi, Missouri, Montana, New Jersey, Vermont, Virginia and D.C. as lower-threshold states where you may get a 1099-K below the federal threshold; Upwork says the list can change.","Sales tax may be charged on Connects and membership purchases based on the tax residence in your account, so keep your address current.","Income earned through Upwork Payroll is W-2 wages with withholding; keep it separate from your self-employment income."],"competitors":["fiverr","toptal","freelancer-com"],"sources":["https://support.upwork.com/hc/en-us/articles/211062538-Learn-about-the-Freelancer-Service-Fee","https://support.upwork.com/hc/en-us/articles/211063958-Report-income-as-a-U-S-freelancer-on-Upwork","https://support.upwork.com/hc/en-us/articles/211067918-Why-you-don-t-file-tax-forms-for-freelancers-on-Upwork","https://support.upwork.com/hc/en-us/articles/211060918-How-to-get-paid-on-Upwork","https://support.upwork.com/hc/en-us/articles/360025040794-Direct-Contracts-bring-a-client-to-Upwork","https://support.upwork.com/hc/en-us/articles/7016892218259-How-U-S-sales-tax-works-for-freelancers-on-Upwork","https://www.upwork.com/resources/is-upwork-free","https://www.irs.gov/newsroom/irs-issues-faqs-on-form-1099-k-threshold-under-the-one-big-beautiful-bill-dollar-limit-reverts-to-20000","https://www.irs.gov/instructions/i1099mec","https://www.irs.gov/businesses/small-businesses-self-employed/manage-taxes-for-your-gig-work","https://www.upwork.com/resources/upwork-vs-fiverr","https://www.upwork.com/resources/upwork-vs-toptal"],"asOf":"2026-10-07","url":"https://gigaverse.ai/platforms/upwork","affiliated":false}