The Art Of Barter by Karen Hoffman

Author:Karen Hoffman
Language: eng
Format: epub
Publisher: Skyhorse Publishing, Inc.
Published: 2011-01-17T05:00:00+00:00

CHAPTER 7

BARTER, TAXES, AND YOU

When you earn a paycheck, you’re not the least bit surprised that the Internal Revenue Service takes its chunk of taxes from your wages. Aggravating as that may be, it goes with the territory, and you know that’s just part of the “cost” of working. But what about barter?

If you ask, plenty of casual traders will tell you that you don’t have to pay taxes on barter. Of course, there are other extremes in which people claim that bartering is illegal. (It isn’t!) So is barter a permanent tax-free holiday? Don’t inflate the party balloons just yet. The answer is maybe yes, maybe no. It depends on two key factors: How much are you trading, and what do you do for a living?

Our friends at the IRS (and believe us, we like to stay on the good side of those folks) don’t require you to pay taxes on the value of what you barter if:

the barter was the “incidental sale of personal property,” and

the trades are not part of the way you earn cash income.

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