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Questions about getting started as a seller!


mt_calvary
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Hey everyone! I am new to the world of freelancing and have some questions before getting started that I am having a hard time finding answers to ( mixed advice and info via YouTube and Google lol ). And these questions may seem silly but I am new to freelancing and haven't got a clue so any and all information on the below questions would be very helpful and beyond appreciated! 

1. Before selling services on Fiverr, do I need to obtain any documents or licenses such as an EIN, sales tax permit or a business license ( LLC ) etc?

2. What sort of taxes do Fiverr freelancers have to pay other than income tax? I've researched this and have read that as a self-employed individual you will need to pay self-employment taxes which includes both Medicare and Social Security taxes. This makes sense to me however, I have also read that Fiverr automatically takes the Medicare and SS taxes out and will send you a 1099 form? I don't think that that is accurate but wanted to be sure because as a freelancer you're self-employed and generally when you are self-employed you hire a tax accountant to do your taxes and you have to pay back taxes and nothing is withheld. But maybe Fiverr is different?

3. At what point will Fiverr send you a 1099 form? I enquired about this and some said that once you make $600 in sales or more then that is when Fiverr will send you a 1099 form however, some also said that the minimum was $400. As someone who has never been self-employed and has only ever worked for public retail or community centers who provide a W-2 at the end of each year, this information would be very helpful.

4. For those who have been at this awhile, in all honesty, what percent of my income should I put back for the sole purpose of paying back taxes? And is it true that as a freelancer you have to pay back taxes quarterly? A member of my family started freelancing back in 2012 and did it for a few years and said that they never had to pay taxes  quarterly but instead had to pay taxes at the end of the year like most normally would having a regular part time job at a retail center. I'm not sure if that just depends on what State and/or Country you reside in but information on that would be extremely helpful as well.

 

Any other tips or suggestions would very helpful and appreciated. Also, if there is anything you wish you had known before becoming a freelancer on Fiverr that you think I should probably know but I didn't think to ask then please let me know, I would greatly appreciate it as I'm sure any first timers who end up reading this also would!

Thank you all so much!

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@mt_calvary

#1. No, at least I never have and I have worked on Fiverr for 4 years.

#2. At the end of the year I print out the spreadsheet Fiverr providers that reflects my Fiverr income and send it to my tax man. I started working here after I retired so I am not sure about SS and Medicare. But I think that would be something to discuss with your accountant at the end of the year. 

#3. Fiverr will not send you a 1099 unless you make $20,000 in a year.

All of this information you need is here: ⬇️

https://www.fiverr.com/support/articles/360011135837-W-9-Collection

#4 Another question for your tax man. But remember to keep track of all your expenses. I claim the % of my home's square feet that my office has. Plus, you can claim your software, computer, printer and so on.

Good luck!

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  • 5 months later...
On 9/28/2021 at 12:03 AM, vickiespencer said:

@mt_calvary

#1. No, at least I never have and I have worked on Fiverr for 4 years.

#2. At the end of the year I print out the spreadsheet Fiverr providers that reflects my Fiverr income and send it to my tax man. I started working here after I retired so I am not sure about SS and Medicare. But I think that would be something to discuss with your accountant at the end of the year. 

#3. Fiverr will not send you a 1099 unless you make $20,000 in a year.

All of this information you need is here: ⬇️

https://www.fiverr.com/support/articles/360011135837-W-9-Collection

#4 Another question for your tax man. But remember to keep track of all your expenses. I claim the % of my home's square feet that my office has. Plus, you can claim your software, computer, printer and so on.

Good luck!

The new law is $600.

So when are they sending them?

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