Barter 101

by Lynn Parramore on April 30, 2009 in Lifestyle,Money

barter fish hands 150Busted-flat? As Janet Joplin sang, “it ain’t nothin’ honey, if it ain’t free.” You can get what you want without paying a nickel if you know how to barter. We should know: the website you’re looking at is partly the result of bartering. Barter isn’t about making some kind of shady deal: it’s a legitimate form of commerce that has been going on since the beginning of time, and is making a strong comeback in the downturn. Do you need a new backyard fence? Tech support? Babysitting? Chances are, there is someone who can provide these services in exchange for something you can offer.

1. Get the word out
First, you have to know what you’ve got and get the word out to your social network. Bartering requires a certain level of trust, so it makes sense to look first in your own communities. Church groups, social clubs, Facebook circles, and neighborhood associations all make great settings for finding a barter partner. Maybe you love cooking but you’re all thumbs at carpentry. Your neighbor, however, can build anything, and is throwing a big party for his wife’s birthday. You cater your neighbor’s party, and he builds your backyard fence. It’s a win-win. Our contributor Jodi Mardesich traded her yoga classes for art. You can trade skills, services, or the products of your skills.

2. Surf the Web
The Web has made bartering incredibly easy. Craigslist.org is an obvious place to start, and there are sites springing up all the time that cater to barterers, like SwapThing.com, SwapTree.com, and Switchplanet.com. For the environmentally-conscious, Freecycle.org encourages a “worldwide gift economy” that allows you to get rid of unwanted items and pick up stuff you need, for free. List your request, along with what it is you’re offering in exchange. Be clear in your comments. If you want to trade a thing, take a couple of pictures of it and give a fair description.

3. Join or start a barter club
Local trading associations and bartering clubs have become increasingly popular in the downturn. Check your local Chamber of Commerce for clubs and do a Google search of clubs in your area. You can also start your own bartering club, which can be as simple as a monthly clothing swap among friends.

4. Get it in writing
If you’re swapping bikes with a neighbor, you don’t need anything in writing. But in most situations, it pays to write down your agreement. Include the basics of who and what’s involved, noting the value of the services and the time line for completion.

5. Don’t ignore Uncle Sam
You may have tax responsibilities if you barter. The IRS website says that you should “treat barter income as you would any other business activity. Keep good records, work with a reputable barter exchange and consult the IRS or a tax professional if you have questions.” If you barter through an exchange, you should receive a 1099-B form to include on your tax return.

http://www.lvrj.com/living/37406499.html

www.freecycle.org

irs instructions

http://www.irs.gov/taxtopics/tc420.html

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