prospect39
Member

Does Upwork Provide Tax Forms to Members?

Elance provided tax forms to U.S. members, including the W-9 and 1099-MISC.  Freelancers input the appropriate info, and the site generated the completed, downloadable forms for use at tax time.

 

Does UW provide this same service?  If not, are there plans to offer this service?

 

A new client asked for a W-9, but because neither of us could find any information in HELP, I ended up using the form provided at the IRS website.

 

Thanks!

14 REPLIES 14
kochubei_valeria
Community Manager
Community Manager

Hi Peter,

 

You filled W-9 form in your Settings. It's required for all US-based freelancers in order to withdraw their funds. You don't need to send it to your client separately.

 

Regarding 1099 form, please refer to this help article for more information.

 

I hope it helps.

~ Valeria
Upwork

Hi Valeria,

 

Thanks!  I do remember inputting my W-9 info here, so I initially told the client that he could access the form at UW.  However, he wasn't able to find it. 

 

For future reference, can you offer instructions (or a link) on how clients can access this information?

 

Pete

Hi Pete,

 

You can share this help article with your client. Technically they are not responsible for filing tax forms for their freelancers with a few exceptions.

~ Valeria
Upwork

So ... if future clients want the W-9 information I entered at UW, can they download my completed W-9 form from UW, or do I need to supply the completed form myself (as I did with this first client)?

 

 


@Peter G wrote:

So ... if future clients want the W-9 information I entered at UW, can they download my completed W-9 form from UW, or do I need to supply the completed form myself (as I did with this first client)?



 

Your clients do not need, or should ask you for your W9.

 

They pay Upwork, so if they need a W9 they can ask Upwork for theirs.


@Petra R wrote:

 

 Your clients do not need, or should ask you for your W9.

 

They pay Upwork, so if they need a W9 they can ask Upwork for theirs.


Unless UW operates very differently from every other online site I've used, that's not true.

 

Upwork is a third party (a broker) to transactions between clients and freelancers. Although it facilitates the transactions, including the payments, UW is not the party contracting with the clients to provide services.

 

Therefore, if U.S. clients want to deduct freelancer fees from their taxes, they need to issue Form 1099-MISC to their U.S. freelancers. But before doing this, they must first collect each freelancers' tax information from a W-9.

 

Clients don't hire Upwork. They hire us.

 

So for clients who request a W-2, it is the responsibility of the freelancer to educate their client of changes in the tax code?

 

"Due to recent changes in the tax code, I am not required to give you a W-2, and you should not be filing 1099-MISC for me. See this article."

 

I imagine that will go over real well Smiley Frustrated Reads a lot like tax evasion.

 

As a freelancer, what is the proper response here to inquiring clients?

Christopher,

 

Did you make a typo? If you have clients asking you about W-2s:

  • Their misunderstanding that they need a W-2 is not your problem.
  • Their other misunderstandings about the client-contractor relationshiips are likely a bigger problem.

Assuming you meant W-9, it's not your place to educate clients on tax law, and doing so is risky. If a client wants a W-9, download the form from the IRS and fill it out, consistent with the information you've already provided Upwork, which is available under your account Settings>Tax Information.

 

Best,

MIchael

Thanks, I did mean W-9.

 

Although if a client takes the W-9, and files a 1099-MISC, and Upwork (if applicable) files a 1099-K, then that same income is reported twice to the IRS.

 

Come tax time, who can say the IRS will not perceive the taxpayer as under-reporting their income?

 

Unless Upwork is collecting the relevant tax information from the paying clients, the IRS has no way to make the connection that this same income is merely reported twice.

Upwork is collecting the information, Chris, and you can rest assured it's reporting whatever it has to report, in the proper format. It's just not providing the forms.

1099-MiSC and 1099-K forms report different classes of income client expenditure. They cannot overlap or duplicate. Any duplication would be automatically rejected by the IRS as invalid data. And although you might get a copy of the 1099-MISC, both forms are really about the client's taxes, not yours. Recipients are a mere audit check on the issuer.

 

Your responsibility is to make sure any 1099-reported income is included in your own income reporting, which you absolutely cannot depend on 1099s to document.

 

Best,

MIchael

Thanks Douglas, I understand a contractor cannot depend on 1099's to sum up his income.

 

What I don't understand is how the overlap in reported income is avoided. For example:

 

A contractor makes $20,000 on Upwork and a 1099-K is issued by Upwork to the IRS.

But $5,000 of that income came from a single client, who independently issues a 1099-MISC to the IRS.

 

Now unless this client has provided his TIN etc., to Upwork, and Upwork, who (I assume) includes this info on the 1099-K, the IRS has no basis to see an overlap/duplicate in a contractor's reported income, and to them it looks like the contractor has earned a total of $25,000.

 

Christopher,

 

It's my understanding that the 1099-K is payer-specific, not aggregate.

 

Per the IRS, a year and a half ago:

 

"We are aware of a potential for 1099-MISC and 1099-K double reporting, and are constantly monitoring our case selection criteria to address this. We do expect to provide more guidance, but we also do not expect this issue to lead to an increase in examinations."

http://www.forbes.com/sites/kellyphillipserb/2014/08/29/credit-cards-the-irs-form-1099-k-and-the-193...

 

Fret further if you like. I'm done.

 

Best,

Michael

Nice quote! Good to see the issue is acknowleded. I guess as long as the contractor keeps his records in order, no concern.

 

Thanks Douglas.

The intricacies of US tax law aside, a client has requested a W-9 from a contractor. Both client's and contractor's experience indicate that this is necessary. Upwork has inserted itself into this process by collecting W-9 information from the contractor. So why doesn't it port this information out to a form for both interested parties to avail themselves of on demand?