How to Create a Venmo Invoice

How to Create a Venmo Invoice

Venmo started as a peer-to-peer money app for splitting brunch tabs, but it has quietly become a major payment rail for US freelancers, side-hustlers, and small business owners. Clients love the simplicity. You love the speed. The problem? Venmo does not have a built-in invoice generator the way PayPal does, so creating a professional invoice that pairs with a Venmo payment request requires a workaround. This guide shows you exactly how to create a Venmo invoice that looks professional, gets paid quickly, and keeps you on the right side of IRS reporting rules.

By the end of this article, you'll have a step-by-step process, a free invoice template, and a clear understanding of when Venmo is the right payment choice versus when you should push clients toward ACH or another rail.

Why Venmo Is Popular but Tricky for Invoices

Venmo is owned by PayPal but operates differently. The consumer Venmo account is meant only for personal payments — splitting dinner, paying a roommate for rent, sending a friend money for concert tickets. For business transactions, Venmo requires you to use a Venmo for Business profile. This distinction matters for two reasons: tax reporting and platform rules.

Using a personal Venmo account for business income violates Venmo's terms of service and can lead to account freezes. Worse, if the IRS audits you and finds business income flowing through a personal Venmo account, you'll have a harder time substantiating deductions and reporting accurate income. The right move is to open a Venmo for Business profile, which is free and takes about five minutes. Once active, you can accept business payments, and Venmo will issue a 1099-K if your gross receipts exceed $5,000 in 2026 (down from $20,000 a few years ago — the threshold has been gradually lowered).

The second issue is that Venmo does not generate invoices. The platform is designed around payment requests, not formal invoices. When you tap "Request" inside the app, you can enter an amount, a memo, and that's it. There's no line-item breakdown, no due date, no terms and conditions, and no PDF receipt for either party's records. For a $25 payment from a friend, this is fine. For a $1,200 freelance project, it's wholly inadequate.

That's where a paired invoice comes in. You send a real, structured invoice via email or PDF, then send a separate Venmo payment request for the same amount. The invoice gives you the legal and accounting backbone; Venmo handles the actual money movement.

Step-by-Step: Creating a Venmo Invoice

Here's the workflow that works for most freelancers, top to bottom. First, generate a professional invoice using a tool like the free generator at /free-tools/invoice-generator. Fill in your business details, the client's details, a unique invoice number, the date, the due date, the line items, and the total. Add a note in the payment instructions section: "Pay via Venmo @yourbusinesshandle. Please include invoice number INV-1042 in the memo."

Second, save the invoice as a PDF and attach it to an email. The email body should be short and friendly: "Hi Sarah, attached is invoice INV-1042 for the website project. Payment is due by April 15. To pay quickly, please send via Venmo to @JaneDoeDesign and include the invoice number in the memo. Let me know if you need any other format. Thanks!"

Third, open Venmo on your phone and tap "Request." Enter the client's Venmo handle if you know it, or wait for them to send the payment. If you initiate the request, include the invoice number in the note so both parties can reconcile.

Fourth, once payment lands, mark the invoice as paid in your records and send a brief receipt or thank-you note. If you use accounting software, log the payment immediately so your books match Venmo's transaction history at month-end. This is a five-minute habit that saves hours at tax time.

Venmo for Business: Fees and Setup

To use Venmo for business invoices, sign up for a Venmo for Business profile. From the main Venmo app, tap your profile, then "Create a business profile." You'll need an EIN if you have one, or your SSN if you're a sole proprietor. Once approved, you have a separate handle (like @JanesPhotography) that's clearly identified as a business account.

Venmo for Business charges 1.9% plus $0.10 per transaction for standard business payments in 2026. That's significantly cheaper than PayPal's 3.49% + $0.49. On a $1,000 invoice, the Venmo fee is $19.10, versus $35.39 on PayPal. Over many transactions, the savings add up.

There are tradeoffs. Venmo for Business does not yet support international payments — the platform is US-only. You also lose some of the chargeback protection that PayPal offers. And while Venmo offers a debit card to spend your business balance, transferring to your bank takes one to three business days for free or 1.75% for instant transfer.

For most US-based freelancers serving US clients, Venmo for Business is an excellent secondary payment rail. Just be intentional: tell clients up front which methods you accept, and avoid the friction of last-minute payment negotiations.

Tax Reporting and the 1099-K

The IRS treats Venmo business income the same as any other 1099-K reportable income. Starting in 2026, third-party payment processors like Venmo must issue Form 1099-K to anyone who receives more than $5,000 in goods-and-services payments during the year. You'll receive the form by January 31 of the following year, and a copy goes to the IRS.

Important: receiving a 1099-K does not change your tax obligation. Whether or not you receive the form, you are required to report all business income on Schedule C of Form 1040. The 1099-K is just a reporting tool for the IRS, not a determination of taxable income. If you receive a 1099-K that includes personal transactions misclassified as business (which can happen if a friend uses the "goods and services" toggle by accident), you'll need to adjust on your return.

Keep meticulous records. Every Venmo invoice should be saved as a PDF, and you should download your Venmo transaction history at year-end (it exports as a CSV). Pair each invoice with the corresponding Venmo transaction so you can substantiate income line by line if needed.

Also remember self-employment tax. Net earnings from self-employment over $400 trigger self-employment tax at 15.3% (12.4% Social Security up to the wage base, plus 2.9% Medicare with no cap), reported on Schedule SE. Make estimated quarterly payments using Form 1040-ES if you expect to owe $1,000 or more for the year. Underpayment of estimated tax triggers IRS penalties even if you ultimately pay the full balance in April.

When to Use Venmo vs. Other Payment Methods

Venmo is best for small-to-medium invoices ($50 to $2,000) with individual clients, sole proprietors, or small businesses. It's fast, low-friction, and most US adults already have the app. For one-time projects with new clients, Venmo signals that you're flexible and modern.

Venmo is a poor choice for large invoices (over $3,000), international clients, or corporate AP departments. Large companies usually require ACH or check because of internal controls; they need a bank-traceable transaction for their auditors. International clients can't use Venmo at all. And for invoices over $3,000, the 1.9% fee starts to add up — ACH is essentially free and just as fast.

Venmo also doesn't support recurring billing the way Stripe or a dedicated invoicing platform does. If you have a client on a $500/month retainer, you'll have to send a manual request every month, which is friction for both of you. For retainers, automatic ACH or a recurring credit card charge through a real invoicing platform is much cleaner.

The right approach: offer Venmo as one option among several. List it on every invoice alongside ACH details, a check mailing address, and maybe Stripe credit card payments. Let the client choose. The more friction you remove, the faster you get paid.

Scaling Beyond Manual Invoices

Manual Venmo invoicing — generate a PDF, send the email, send the Venmo request, log the payment — works for one to five clients. Beyond that, you're spending hours each month on what should be a 30-second task. This is where Eonebill.ai earns its keep.

Eonebill is purpose-built for US freelancers and small business owners. The AI writes your invoice from a short description, automatically pulls in client info, generates professional PDFs in seconds, sends them with payment links, and tracks who has paid and who hasn't. You can still offer Venmo as one of multiple payment options on every invoice, but the busywork of tracking, reminding, and reconciling is automated. See /pricing for plan details — there's a free tier so you can start without commitment.

The bottom line: Venmo is a fantastic payment rail, but it's not an invoicing system. Pair every Venmo payment request with a real, professional invoice. Use the free template at /free-tools/invoice-generator to get started, and upgrade to full invoicing automation once your client count grows. Either way, every dollar of Venmo income should be backed by a clean invoice, properly tracked, and accurately reported on your taxes.

A related consideration as your Venmo invoicing volume grows: state-level tax reporting can vary. While the federal 1099-K threshold is now $5,000 for 2026, some states have lower thresholds (Massachusetts, Vermont, and Maryland have historically had lower state-level reporting requirements). Check your state revenue department's rules. Don't be surprised if you receive a state-level 1099-K from Venmo even when you didn't cross the federal threshold. State income tax also applies to your freelance income in most states (45 of them have state income tax). Estimated state tax payments are typically made on the same quarterly schedule as federal — though some states have slightly different due dates. Build state tax into your 25-30% tax savings habit. For California freelancers, the combined state and federal tax burden on freelance income can hit 40-50% for higher earners. For Texas, Florida, and other no-income-tax states, you only worry about federal. Know your state, plan accordingly, and Venmo for Business becomes a clean, well-tracked payment rail in your overall freelance finance system. Many successful freelancers run primarily on Venmo and ACH, using Venmo for clients who prefer the app and ACH for those who don't. The combination covers nearly every US client without the higher fees of credit card processing.

A final tip on Venmo-specific reconciliation: download your Venmo transaction history CSV monthly rather than waiting for year-end. Venmo's transaction history is available under Statements in the app, and the CSV format is easy to import into a spreadsheet or accounting tool. Monthly reconciliation catches errors early — a missing payment, a duplicate transaction, a client who paid the wrong amount — and lets you fix them while the context is fresh. Year-end reconciliation against a 12-month CSV is much harder than monthly checks. Keep the CSVs in a dated folder so you build a complete audit trail without effort. The 15 minutes of monthly reconciliation pays back many hours of frustration during tax season.

A useful planning tool for Venmo invoicing is a quarterly review of your fee burn rate. Add up all the Venmo transaction fees paid in the quarter — at 1.9% plus $0.10 per transaction, a freelancer running $15,000 of quarterly Venmo volume across 30 invoices pays roughly $315 in fees. Compare that to ACH processing (essentially free) on the same volume and you see a real cost difference. For high-volume freelancers, the right answer may be Venmo for smaller invoices ($50-$500 where the fees are modest in absolute terms) and ACH for larger ones ($1,000+ where the percentage cost compounds). Most invoicing platforms let you specify different default payment methods for different invoice sizes. A small tuning step that recovers hundreds of dollars per year for active freelancers.