The taxman cometh

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The taxman cometh

Looming over the barter economy is the specter of tax liability. Caroline Wilson, enrolled agent and master tax advisor for H&R Block in Charlottesville, says, “Bartering for us from a tax standpoint is very simple: It’s income. Scrip currency is treated for tax purposes as though it were U.S. cash.”

She says most people wouldn’t report my chicken/flower trade (as indeed I do not intend to) and that tax instructions refer to “payments…made in the course of your trade or business.” SBN’s website instructs that as long as “the Scottscrip you earn is claimed on your income taxes, the money isn’t funny” and SBN’s states: “The fair market value of goods and services exchanged must be included in the income of both parties,” though exchanges of “non-professional” goods and services are not taxable.

If you have any questions about tax liability, for God’s sake remember Willie Nelson and consult a qualified tax advisor.

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