Remote Business, Global Clients: Invoicing and Getting Paid Internationally From the US

Working for clients in London, Lisbon or Dubai from a desk in the United States is an ordinary business today. What needs attention is the money trail: which currency you invoice in, how foreign receipts reach your books in dollars, what the client's country expects on the invoice, and how your own taxes are paid through the year. Set those up once, and the rest becomes routine administration.

This is general information. Your CPA and counsel confirm the details for your case.

Foreign clients still produce US income, in dollars

Your US return is prepared in dollars, whatever currency your client pays. The IRS requires you to express the amounts on your return in US dollars and to translate foreign-currency income and expenses. ¹ If your functional currency is the dollar, use the exchange rate prevailing when you receive or accrue each item. ¹

Invoicing in a foreign currency adds a second step. Foreign currency gains and losses from section 988 transactions are computed separately and treated as ordinary income or loss. ² If you invoice in euros, wait several weeks for payment and convert later, the rate can move between the invoice and the conversion, and that movement can produce a gain or loss of its own. Keep the invoice rate, the receipt rate and the conversion rate in your records.

Platforms report some payments; you report all of them

Payment apps and online marketplaces must send you a Form 1099-K when your payments for goods or services total over $20,000 in more than 200 transactions, and they may send one for lower amounts. ³ The form is not the boundary of what is taxable. The IRS is explicit that, whatever the amount reported, you must report all income from selling goods or services on your tax return. ³ A wire from a foreign client that never appears on any US information return is still income.

Self-employment tax and quarterly payments

If you work for yourself, foreign clients do not change self-employment tax. The rate is 15.3%, made up of 12.4% for Social Security and 2.9% for Medicare, and it applies once your net earnings from self-employment reach $400. ⁴ For 2026, the Social Security portion applies to earnings up to the $184,500 contribution and benefit base. ⁵

Plan for that tax through the year. Individuals generally have to make estimated tax payments if they expect to owe $1,000 or more when they file. ⁶

The client's country has rules too

Your client's tax system can affect what your invoice must say. In the European Union, the place of supply for services to a business customer acting as such (a taxable person, in the directive's terms) is generally where that customer has established its business. ⁷ When the supplier is not established in that member state, the VAT is payable by the business customer receiving the service, an approach usually called the reverse charge. ⁷ Ask an EU business client, or a local adviser, what their invoices need to show. Consumer sales and other countries follow their own rules.

Some countries withhold tax on payments for services. If foreign tax is taken from income that is also taxed in the US, you may be able to claim either a credit or an itemized deduction for it. Individuals claim the credit on Form 1116, and the IRS notes that in most cases the credit is to your advantage. ⁸ Keep the client's withholding certificate or statement with your records.

Who you can work for

Sanctions follow you, wherever your clients are. All US persons must comply with OFAC sanctions, including US citizens and permanent residents regardless of where they are located. ⁹ Before you accept a client or a payment route, check that neither involves a sanctioned person or country.

Where the money lands

If you collect international payments into an account abroad, that account joins your FBAR picture. The FBAR is required once your foreign accounts together exceed $10,000 at any time in the year, and your foreign accounts count toward that total, subject to limited exceptions. ¹⁰

What this means for you

Treat international invoicing as a system. Decide your invoicing currency, choose an exchange-rate source, record conversions, and confirm what each client's country expects. Then set your estimated tax payments from your own records, not from what platforms happen to report.

What to do this month

• Choose an invoicing currency policy and a single exchange-rate source for your records.
• Ask each EU business client what their invoices must show for the reverse charge.
• Set quarterly estimated tax payments based on your expected international income.
• Screen new clients and payment routes against current sanctions lists before you start work.

Common mistakes to avoid

• Reporting only what appears on a Form 1099-K.
• Ignoring the gain or loss between invoice date and conversion date.
• Forgetting self-employment tax because the client is abroad.
• Receiving payments into a foreign account without adding it to your FBAR.

The FNC angle

As international revenue grows, you may ask whether payments should flow through a US entity, a foreign company or a foreign account. FNC helps you answer the structural and banking side: where to receive funds, which jurisdiction suits your client base, and what a foreign entity would add in reporting. One of FNC's completed engagements is a UAE FZCO company for an international consulting business. Your CPA handles the US tax treatment of whatever you choose.