InvoicingandTaxes:WhatUSSmallBusinessesShouldKnowBeforeHiringaFreelancer

A freelance developer typically invoices on an agreed schedule — at project milestones for fixed-price work, or on a regular cycle (weekly or monthly) for hourly work. Invoices should reference the contract or scope of work, making it easy to track what's been paid against what was agreed. Keep these records — they matter for your own bookkeeping and, potentially, for tax purposes.

This is general information, not tax advice — a qualified accountant should confirm the specific record-keeping and reporting requirements for your business.

For a US-based freelancer paid over a certain threshold in a calendar year, you'll typically need to collect a W-9 and issue a 1099-NEC. For an international freelancer — for instance, a developer based in Nepal — the 1099-NEC process generally doesn't apply the same way, since it's oriented around US persons; instead, documentation like a W-8BEN is commonly collected to confirm foreign status, and payment is usually made directly via bank transfer or a service like Wise.

Your accountant is the right person to confirm exactly what applies to your business, but knowing this distinction upfront helps you ask the right question instead of assuming international payments require the same paperwork as domestic ones.

Fixed-price engagements commonly start from USD 500, with milestone-based invoicing. Hourly engagements run USD 25–45/hr with a 10-hour minimum, typically invoiced on a regular cycle. A written quote is usually available within 48 hours of a scoping call.