Payment terms, explained
Short, plain-language pages on the words that appear in cross-border freelance work: forms, rails, fees and the entities behind them.
- Merchant of record
A merchant of record issues the invoice, collects payment and takes on compliance duties, standing in as the seller instead of a processor or employer.
- W-9
Form W-9 confirms a US taxpayer's name and ID number to a payer. See who completes one, why US clients request it, and why foreign freelancers do not.
- W-8BEN
Form W-8BEN certifies foreign status to a US payer. Learn when a client requests one, what it changes about withholding, and the onboarding friction it adds.
- Form 1099-NEC
Form 1099-NEC reports US nonemployee compensation above the IRS threshold. See what it covers, who gets one, and why foreign contractors normally do not.
- ACH
ACH moves dollars between US bank accounts, usually free or low cost for the sender, settling in one to three business days. Here is how it works.
- Wire transfer
A wire transfer sends funds directly, bank to bank. Domestic wires often clear the same day; international wires can pick up fees along the route.
- SWIFT
SWIFT is the messaging network banks use to send payment instructions, not a money mover itself. See how correspondent banks add fees and delays.
- SEPA
SEPA moves euros between participating European countries like a domestic payment. See what currencies it covers and how fast transfers arrive.
- USDT
USDT is a token intended to be worth one US dollar, issued by Tether across several blockchain networks. It is not a bank deposit or state-insured.
- TRC-20 vs ERC-20
TRC-20 and ERC-20 are different networks that can carry the same token. See how cost and speed differ, and why the network has to match the wallet.
- KYC/AML
KYC confirms who a customer is; AML covers the wider anti-money-laundering controls. See what documents are asked for and what stays one-time.
- Statement of work
A statement of work describes the service performed on an invoice line. See why a precise description clears accounting review faster than a vague one.
- Contractor vs. employee
See how a contractor's invoice differs from payroll, which forms apply to each, and why misclassification risk sits with the paying company.
- Escrow
Escrow holds funds until agreed conditions are met. A merchant of record works differently: funds move on payment, not on a milestone release.