Bartering Basics: Something for Something

With the recession on, bartering appears to be making a comeback. With bartering, you offer goods or services in exchange for…goods or services. If you have an extra bike, but want a nice backpack, you might be able to find someone who wants a bike but has an extra backpack. You can swap. The same is true of services. One of the easiest ways to get involved with bartering is to do so online. However, you can also find groups in your community that set up barter exchanges.

When bartering, it is important to keep a few things in mind:

1. Find the right place. Whether you are looking online or joining a community bartering group, it is important to look for a venue that works well for you. Do a little digging: Some groups have a specialty in outdoor equipment and others have exchanges for business members in the community.
2. Offer specifics when bartering. Bartering is about coming to an agreeable exchange of products and/or services that are similar in value. This means you need to be specific about what you are offering and what you need. Often, there won’t be a way to determine a direct monetary correlation. Instead, you have to be specific about what you will do, and what you will accept in exchange.
3. Get some sort of record of the barter exchange. Make sure that you have a record of your barter exchange. Even if you are just swapping equipment, make sure that you each get a copy of a receipt that describes the transaction.
4. Be on the alert. While many that engage in bartering are honest, there are scammers lurking online and even in person. Be sure to be on the alert for scams. One way you can protect yourself online is to look at user feedback on bartering Web sites.
5. Understand that the IRS may want a piece. Some bartering income is taxable. It is important that you know what is taxable. The IRS Web site offers this helpful insight into barter income: “Bartering occurs when you exchange goods or services without exchanging money. An example of bartering is a plumber doing repair work for a dentist in exchange for dental services. The fair market value of goods and services received in exchange for goods or services you provide must be included in income in the year received.”

Bartering can be a rewarding way to exchange goods and services, but you need to be polite, honest and careful. Here are some Web sites that can help you trade goods and services over the Internet:

Craig’s List

Swap and Save

Freecycle

U-Exchange

Web Swappers

Barter Your Services

image source: Wikimedia Commons