Taxes for Buyers. Reporting Contractor work

[fulton56193bl]

Hi, 2017 was my first year buying gigs on Fiverr. Can anyone tell me how other buyers are itemizing contractor expenses on their Schedule C? Each line I have to put in the persons first and last name of each freelancer.

But as you know, everyone has only screen names on Fiverr. So instead of a full name I’m going to have to put in something like “sam_the_artist66” (made up) on my Schedule C which is going to look strange to the IRS.

I’ll deal with this when discussing with my tax preparer, but I would like to know how vetetan Fiverr buyers dealed with this. Did you instead put it under the Other Expenses category and type in “Fiverr” as the payee in your ledger instead of the freelancer’s name?

[misscrystal]

Since you did not pay anyone directly but instead paid fiverr it would seem logical to put in fiverr.com as the payee.

[fulton56193bl]

Yes, that’s what I’m thinking, too. Thanks. I’ll discuss this with my preparer. Still, the IRS may have a different interpretation. They could say that the freelancers are not Fiverr employees and that Fiverr is merely a middleman in the transaction. When I contracted work for another freelancer site, they regularly provided 1099s (until last year because of law changes in the tax code) to the buyers and sellers, indicating they didn’t consider the freelancers on their site as employees.

[gina_riley2]

Yes, that’s what I’m thinking, too. Thanks. I’ll discuss this with my preparer. Still, the IRS may have a different interpretation. They could say that the freelancers are not Fiverr employees and that Fiverr is merely a middleman in the transaction. When I contracted work for another freelancer site, they regularly provided 1099s (until last year because of law changes in the tax code) to the buyers and sellers, indicating they didn’t consider the freelancers on their site as employees.

I put down one lump sum of 5r as the freelancer, even though it’s a platform and not actually the contractor/seller.

I keep a spreadsheet of all my business transactions as the platform of 5r, seller’s username, the type of gig (proofreading, editing, ebook cover, etc.) and the amount. I also keep the invoice as a backup in case of an audit.

I’ve done this for the past 3 years and no one has questioned me thus far. Then again, I don’t have enough business deduction for anyone to really care.

[misscrystal]

Yes, that’s what I’m thinking, too. Thanks. I’ll discuss this with my preparer. Still, the IRS may have a different interpretation. They could say that the freelancers are not Fiverr employees and that Fiverr is merely a middleman in the transaction. When I contracted work for another freelancer site, they regularly provided 1099s (until last year because of law changes in the tax code) to the buyers and sellers, indicating they didn’t consider the freelancers on their site as employees.

Well you can’t put the fiverr ID down as the person you paid since that’s not their name. And you didn’t pay them.

[fulton56193bl]

Well you can’t put the fiverr ID down as the person you paid since that’s not their name. And you didn’t pay them.

Thanks Gina. I appreciate relating what you do.

In the end, it’s the IRS’s viewpoint of what is law, not neccesarily common sense. My guess in the future when Fiverr buyers are randomly audited by and the IRS, the auditors are going to see that this website called Fiverr is actually a marketplace, not a contractor, and they will probably force Fiverr to reveal real names to buyers and sellers.

[mabelma]

Thanks Gina. I appreciate relating what you do.

In the end, it’s the IRS’s viewpoint of what is law, not neccesarily common sense. My guess in the future when Fiverr buyers are randomly audited by and the IRS, the auditors are going to see that this website called Fiverr is actually a marketplace, not a contractor, and they will probably force Fiverr to reveal real names to buyers and sellers.

Let’s hope Fiverr makes it easier for both seller and buyers to do their taxes so that this macabre outcome doesn’t come to be. <3