Barter is a method of transacting business without the use of cash. Trading one thing for another. Sounds easy but you may be wondering how the IRS feels about barter. It’s wise to check out the requirements at www.IRS.gov.
Here’s a general insight to the consumer end of barter by a barter industry veteran. “The consumer end of it has always been a very gray area because there is no reporting that takes place, so the IRS has no way of tracking those transactions and the people themselves probably don’t have a receipt,” says Tom McDowell, retired executive director of the National Association of Trade Exchanges. “If you make a profit, then it would be a taxable event. If you sell it for less than you paid for it, then it would not be a taxable event because you are not making money.”
Tax requirements for trade exchanges are a bit more involved as reporting is required. Programs such as the Barter Solutions software make those tasks easy. McDowell can help a new trade exchange organize its internal structure to best facilitate proper reporting. McDowell’s tools such as the Barter Trainer Program Manuals, Barter Solutions Software, Marketing Concepts, and much more are available. Contact The Barter Trainer today to start taking advantage of the benefits of barter.
http://www.irs.gov/businesses/small/article/0,,id=187920,00.html
