For tax purposes, at the end of every year we provide a 1099B
report to all JRTE members, and in March we send the IRS copies
of all of the 1099’s.
Barter sales are taxable and your company must report them
to the IRS just as though were cash. This is also true of
trade purchases. When you spend trade dollars to purchase
services or products through a barter exchange they are taxable
as though they were cash.
Barter Income and the IRS
IRS rules concerning barter are now well established. The
U.S. government considers barter exchanges to be legal third-party
record keepers, similar to banks, brokerages and other firms
that deal with taxpayer records. Barter exchanges are required
to complete and submit Form 1099-B, "Proceeds from Broker
and Barter Exchange Transactions," for each of their
members and the IRS. In order for the exchange to complete
this form, you'll need to give JRTE your taxpayer identification
The IRS considers barter to be the same as cash, dollar for
dollar. There are no special tax benefits - or penalties -
when participating in a barter exchange. This same-as-cash
standard also applies to barter purchases: If a barter purchase
is business-related, you can deduct it from your taxes, but
if it's for personal use you cannot deduct it.
Treat barter just as you would any other business activity.
Keep good records, consult a qualified CPA, and if you have
any questions there are numerous online links that can provide
Below you will find some useful tax information relating
to barter provided by the IRS.
here to read Four Facts About Bartering
here to learn about Record Keeping Tips
here for more information from the IRS Bartering Tax Center
here to view the IRS video called, Do You Barter?