It is that time of the year we all start thinking about taxes, today I met with an accountant and we spoke about what barter meant when it came to taxes. After we met she did a great job recapping the information on her Facebook page and I felt is was worth sharing with the chamber. There were four things she said you need to consider which are listed below. If you want to read her full take on taxes and barter you can check out my blog at Garrison Marketing Solutions.
- Organized barter exchanges: A barter exchange functions primarily as the organizer of a marketplace where members buy and sell products and services among themselves.
- Barter income: Barter dollars or trade dollars are identical to real dollars for tax reporting purposes.
- Tax implications of bartering Income from bartering is taxable in the year it is performed: Bartering may result in liabilities for income tax, self-employment tax, employment tax or excise tax.
- Reporting: How to report The rules for reporting barter transactions may vary depending on which form of bartering takes place.