BARTERING can become an effective way to butter your bread.

[No.23]

I personally believe that bartering will soon be resurrected big time, as an effective way to get some of your needs met.

Case in point.

A woman friend of mine applied for a job at a local supermarket store, recently. She was told, not surprisingly, that there were none to be had.

At my suggestion, and since she is a single mom with 3 kids to feed, she went back to the store yesterday with a different approach.

She offered to barter her services for food and provisions. Period. They told her that they would have to check with their corporate office and will get back to her.

She got a call from the store today. They invited her to discuss the details of an arrangement that they normally wouldn't consider.

These are abnormal times, my friends. And they will get even more abnormal in the very near future, IMO.

Bartering may be the ticket when there are no other tickets.

[Hannah Bell]

1. I suppose they can write it off as charity or something to cook the books,

but that arrangement, if known, can get the supermarket an appointment with the IRS.

[villager]

3. at some point, with enough bartering, the IRS won't be able to keep up...

n/t

[originalpckelly]

2. How will you address the coincidence of wants problem?

http://en.wikipedia.org/wiki/Coincidence_of_wants

In other other words, what if people don't want something at the time it's being offered? This is why money evolved as a human behavior, because with money you can sell or buy something, even when there isn't the coincidence that someone else wants what your buying/selling.

[No.23]

4. Do you know how much food...

the supermarkets throw out on a daily basis?

I was shocked to find out how much, when I, once, collected their throwaways to share with some homeless folks.

Can they also get into trouble for doing that as well?

Many stores currently do that.

[The Stranger]

5. Better communication of enough wants that it cannot help but finding a buyer.

In other words, the Internet.

[originalpckelly]

10. And how will that help out the farmers who grow the food in the first place?

What, are they supposed to feed a barber, the piano teacher, or pay their taxes with grain?

[elleng]

6. 'YOU' don't address;

we the people address our problems, individually.

[No.23]

7. P.S. It is no coincidence that one of the fastest growing...

subcategories in Craigslist is...

yep, you guessed it...

the "bartering" one.

You should take a look at it one day.

It has grown leaps and bounds this past year.

[originalpckelly]

8. All of the things being "bartered" are really the product of money.

It's a damn useful thing. Especially for the very farmers who grew the food in the first place.

[leftstreet]

13. People are bartering their goods there, not their labor n/t

[No.23]

16. If by "there" you mean Craigslist...

the Craigslists that I've seen have tons of ads by craftsmen who are willing to barter their skills for various things.

Mechanics offering to fix cars for things... plumbers, painters, etc. too.

[SoCalDem]

22. The IRS is "involved" in barters.. People need to be careful

Barters that are "contractual", and "followable" ARE TAXABLE...and if the trend picks up, you can bet the IRS will be all over it..

[No.23]

23. Hmmm! Let's see.

Scores of Americans were only able to survive the last Depression because they bartered for the things that they and their families needed. The IRS wasn't around then, of course.

But now that they are around, and when the next Depression comes (and it will), you want Americans to be cautious about bartering to keep their families alive... because of the IRS?

Am I reading you correctly?

[SoCalDem]

29. The IRS used to not care.. I KNOW they "were around" during the depression...

I think it was in the 80's that they started paying closer attention to bartering, and assiging monetary value to bartered goods.. It's never a bad idea to keep the actual bartering process, low-key:)

Barter Accounting Tips
There are a few accounting guidelines to remember when you conduct barter transactions. First, keep in mind that all barter income is dealt with on the cash basis, and the IRS treats barter as income received whether you use accrual-basis or cash-basis accounting. Also, you must report and pay taxes on barter income for the year in which it accrues; if your business is profitable you should try not to have unspent barter credits at the end of the fiscal year. (If you're unprofitable, and your barter income does not make you profitable, the IRS won't tax it.)

What should you do if you have unspent barter credits at the end of the fiscal year? If your barter exchange allows it, you may be able to contribute them to charity and deduct them from your taxes.

Using Barter as Compensation
Barter can be a great way to provide bonuses or other types of compensation without raiding your company's bank account. Just keep in mind that barter compensation, like cash, is subject to personal taxes. If you use barter to compensate a contractor, include it on their Form 1099; if the recipient is a regular employee, declare it on their W-2 and withhold all appropriate taxes.

What Does the IRS Think about Barter?
Some business people believe that the IRS takes a dim view of barter transactions. As a result, they may assume that using barter subjects them to possible audits or to other legal scrutiny.

The truth is that a company using barter is no more likely to get audited than any other business. IRS rules concerning barter are now well established, and the government considers the barter industry to be a perfectly legitimate business.
Treat barter just as you would any other business activity. Keep good records, work with a reputable barter exchange and consult a qualified CPA if you have any questions or problems. If you handle barter transactions properly, they can be a useful — and profitable — part of your business.

Visit the AllBusiness.com finance and accounting center for tips on bookkeeping topics such as payroll, cash flow management and financial reporting. AllBusiness.com is a leading provider of practical information and services for growing businesses.
Copyright 2006 AllBusiness, Inc.
http://www.score.org/fc_8.html

Barter Handbook

http://www.ritchieunlimitedpublications.com/neweconomy/BarterHandbookPg.htm

[No.23]

30. Sorry if I wasn't clear.

I do recall that President Lincoln appointed the first commissioner of the BIR, to collect income taxes to fund the civil war (so that's why they started collecting our income taxes, eh? ).

I was just completely unaware that they had any interest in barter transactions. Until you informed me of that.

Just another shackle, in their closet of shackles, to keep the citizenry in fear of them, it seems.

[SoCalDem]

31. Professionals barter all the time..(under the table)

An orthodontist in my home town always drove a nice new Corvette..with dealer tags.. and the Chevy dealer's kids all had braces :evilgrin:

[No.23]

32. I make a distinction...

between someone who can pay for something but chooses to barter instead...

and someone who barters because he can't pay for what he needs.

Since I personally believe that we are headed for a Depression which will be worse than the last one, I am a strong advocate of learning the skills of the latter.

I have no feelings. either way, regarding the former.

[moundsview]

9. local supermarket store with a corporate office

is just the 1'st thing I see wrong with this scenario. The tax implications, workmens comp problems, possible union concerns, 1099 contract situations just to start with.

But good luck to your friend.

[No.23]

11. Did someone mention farmers above?

A lesson from the last Depression...

for the coming one:

http://www.livinghistoryfarm.org/farminginthe30s/money_12.html

[Name removed]

12. Deleted message

Message removed by moderator. Click here to review the message board rules.

[Webster Green]

18. WTF?!

Spam? :wtf:

[originalpckelly]

19. I know...

I don't think I've ever seen spam on DU before! There is a forum to post spam in too!

[Divine Discontent]

21. at least it's mostly people with political designs and personal items @ DU Marketplace

I am lovin that someone thinks that one of us will actually CALL him for real estate because he spammed his number on our website! Nuts...

[Divine Discontent]

20. oh sweet heavens - SPAM??? yes, I want immediate assistance, Brian. HEY, an idea - let's call Brian

at 3am EST at 312-436-1880, and ask him about the Block Shopper who can help us find a great deal on a home?!!! :rofl:

[smalll]

14. So can owning your own personal cow and your own personal churn --

which is more plausible as per buttering one's bread, well, it's a close-run thing. Neither are too likely for most of us (at least, those of us in the cities and/or suburbs, where cows are inconvenient code violations.)

[babylonsister]

15. What are her services? nt

[No.23]

17. Redux: barter is back.

http://www.recessionwire.com/2009/02/24/redux-barter-is-back/

Looking back at the Great Depression to see the path ahead.

If past crises are any indication, a cash shortage won’t stop the wheels of commerce.

During the1930s, people without money started trading goods and services as a way to keep themselves afloat. Workers exchanged labor for room and board. Students traded farm produce for tuition. Moonshiners, bless them, exchanged goods with just about everybody.

People with skills in high demand did especially well. Someone who could bake delicious bread or sew quality clothing could draw people from miles around to barter for their products. Eventually, people established more formalized barter groups like The Unemployed Citizens League, which had 200,000 members across the country at its peak.

In The New Deal, Ronald Edsforth shows how some groups acted as cheap labor exchanges. Southern California’s Unemployed Cooperative Relief Association, for example, used the slogan “Self Help Beats Charity” to urge families to trade labor in fruit and vegetable fields for food. People interested in self-sufficiency were moved to experiment. The legendary economist Ralph Borsodi organized cash-strapped suburbanites in New York and other cities to trade clothes, furniture, and even artwork for food in barter groups.

Bartering is as old as human history, and it’s not necessary to bring a pig to market to make it work. It’s something all of us have done, in the form of a book swap or a potluck dinner. The recession has brought back an interest in bartering as a way for people to sustain themselves and protect cash flow. No money is changing hands, but each party is giving and getting something in return.

As the downturn continues, more people will be bartering their skills, and some will even be able to turn those skills into lucrative businesses. People with a knack for specialty gardening can gain bartering leverage by producing hard-to-grow herbs and organic vegetables. Those who know foreign languages can trade on translations skills. Smart folks will be thinking of both what they enjoy doing and what they imagine might be in demand in their particular region.

On Craigslist, bartering offers are skyrocketing as people grow cash-poor and can’t use their maxed-out credit cards. A recent browsing of Craigslist New York revealed people bartering tax preparation services, cooking, personal training, guitar lessons, and resume writing. One man offered to trade his litigation services for a reliable van. A photographer sought a stylist for bartering. There was even a psychotherapist offering services in exchange for piano tuning.

Bartering may not sounds as sexy as new-fangled practices like derivatives once did, but the ancient practice offers real value. In this economy, we’ll take it.

Share/Save/Bookmark

[earth mom]

24. Argentina went to bartering when their economy crashed. I agree that it's happening here too.

Recently I've seen ads on Craigslist where contractors are very willing to barter.

[No.23]

25. But you have a poster, above, who is cautioning us...

from doing that because of the IRS.

Imagine that.

If you don't have money to purchase basic essentials, watch out if you're thinking about bartering.

The IRS will get you.

If you try to fend for your family.

Imagine that indeed,

[lapfog_1]

26. No chain store and even most mom and pops would risk it.

They might give her the food, but bartering her time(or other things she might have) for it is very much a no-no, legal wise.

[No.23]

27. If that is true....

and when the next Depression comes...

then it may be possible that we may have a tougher time surviving it...

than our forefathers did the last Depression...

because our system will preclude us from doing...

what many were able to do then.

And that, of course, is barter to keep themselves alive.

[Adsos Letter]

28. Bartering and under-the-table payments....

have existed in the construction trades for decades...so I'm told, anyway...