Tax Topic

Barter Income

This is primarily an FYI item. You engage me to help you minimize your income tax liability and prepare your tax return. I will help you avoid taxes to the best of my ability within the law, but we do have to stay within the law.

One area that is seeing a lot more scrutiny by the IRS is barter income. Barter income is realized when goods or services are exchanged for other goods and services vs. dollars/crypto/virtual currencies. Barter income is taxable in the same manner as dollars, meaning the value of the goods and services received is taxed just as if it were received in dollars.

To avoid any issues with the IRS and barter income, be sure to include information on any barter income with the materials you provide to us to prepare your annual income tax return(s). See the tax topic Virtual Currency for additional information on reporting requirements for virtual currency transactions.

Here is a link to the IRS site on barter income: http://www.irs.gov/taxtopics/tc420.html

< Back to Tax Topics page