I am wondering a few things:
1. I am United States citizen living permanently abroad, so I have a foreign business - I am assuming that I should have "non US person / foreign person" selected in my profile, since I do not have an EIN for my business - is this correct? (I still submit US taxes on a yearly basis.)
2. The prices that I am seeing for jobs are always too low for where I live. I would like some options to appropriately counter the offer, but I am not sure how it works after a potential client gets back to you... like will I be able to adjust payments and deadlines as needed (based on our negotiation)?
3. Some jobs are paid by the hour. I am unwilling to use programs that track my work, etc. This is not expected, is it? I generally avoid working hourly when possible as this is not standard in my industry and can lead to considerable confusion with the customer. (Artists not getting paid for their time, etc.)
4. There is absolutely no place to negotiate extra fees - rush fees, licensing fees, etc. I find this unprofessional and gives the clients the expectation that everything is always included.
5. Your service fees are ridiculously high seeing as the job prices offered are so incredibly low... (25% is what regular agents take in the US, and they actually work for you, actively promote your portfolio and work to get you the highest prices possible for your work + good licensing fees (if these apply); Upwork is incomparable.) I think you need to make a better effort of catering to freelancers who do not live outside the US when your prices are all listed in US dollars... US standard of living is still low for me.... but going lower than that is making it highly questionable if this can be ever be worth my while. Don't get me wrong, I like the platform and I would love to use it long term, but realistically, I am not sure if that is even a viable option with the prices being where they are. It's radical, but I think it would be great if you enforced a kind of minimum wage for jobs based off-of industry standards in the US. (Example: https://www.graphicartistsguild.org) -> This way the artists market could start to self-regulate properly. You'd help a lot of artists make an actual living and your 20% would start looking even better.
6. I often find job descriptions are poorly written or I have questions about the job expectations - where the answers to these questions would determine if I should spend my time (and connects) applying or not. Why do I need to pay connects before being able to talk to the potential customer? I think this scenario needs to be reworked.
7. When the client picks a freelancer, is the job removed / closed? - Am I notified somehow?
8. What does the payout from Upwork look like? There are no hidden fees, right? Because you already take a huge chunk out of the deal and there are connects to pay for... not to mention the people who have paid subscriptions.
9. Can you please prevent the clients from asking for free sample work initially? - This is unprofessional and often results in a complete waste of time for the artist.
10. Please add a place where I can add a link to my terms of service.
Thank you in advance for your help.
The answer to question 1 is that your location should be where you live, not the country of your citizenship. The short answer to the rest of your questions is, "Because that's how things work around here." Yes, prices are low and fees are high and you won't find anywhere close to the kind of professional conditions that you're accustomed to if you've been working for design agencies. There ARE some good clients, but it's like looking for a needle in a haystack. It's up to you to try it and see whether you can get a good return on your investment; for some people it works out very well, and for others it definitely does not.
To be honest with you, it's going to be pretty difficult for you to land your first client if you don't adjust your expectations. Your "terms and conditions," for example: Upwork has its own terms, most notably that once clients pay for the work, they own it. Clients will expect that, and unless your work is extraordinary (far better than all of the other bidders) you'll have a pretty hard time persuading a client to pay additional licensing fees, especially since you have no track record here. But you can put down a placeholder bid and then clients can get back to you if they're interested in negotiating.
Lots of your questions will be answered when you study all the information available for newbies such as the post pinned to the top of this forum.
Otherwise, you are free to use upwork in any way, shape or form you want and you and your client agree on, as long as nothing illegal or against ToS is taking place. There are no limits in place what prices or other conditions you agree on (save for a few minimum stipulations). After you have educated yourself better, you will understand what you need to look out for and how to stay safe and get paid.
To answer some of your questions, April...
When you submit a proposal, you can suggest any terms you like. If it's a fixed price job post you have to submit a price, but you can say in your covering letter that the price is only a placeholder or provisional, and subject to revision when you have more details. After discussion, if the client wants to offer you the job they will send you a job offer with a specific price, which you can accept or reject.
When posting a job, the client decides whether to post it as fixed price or hourly. But there's nothing to stop you from applying to an hourly job and saying that you want to do it as a fixed price. If the client agrees, they can send you a fixed price job offer.
The only way to ask a question about a job post is to submit a proposal, which will cost you connects (unless the client contacted you with an invitation to submit a proposal).