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What Is Bartering? Bartering is the trading of one product or service for another, usually without the exchange of cash.
Bartering is the trading of one product or service for another, usually without the exchange of cash. This could be through a barter-exchange company, or more informally through two individuals or on a one-on-one basis. An example of bartering is a dentist exchanging dental services in return for auto repairs at an auto repair shop.
Yes. The IRS considers goods or services received from a barter agreement to be income for both sides, just like cash. Barter exchanges, according to the IRS, even have their own unit of exchange, which is valued in U.S. currency for the purpose of information returns. Earning “trade” or “barter dollars” through a barter exchange is also considered taxable income.
You file for bartering depending on how the transaction occurred:
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