Savvy business owners are discovering that bartering is a great vehicle for moving excess inventory, attracting new customers, and generating barter dollars that can be used for advertising and other business expenses.
Bartering involves an equal trade. One business swaps a good or service for another. Through professional barter exchanges —where members pay a commission fee for goods or services traded—more complex trades are possible.
Here’s how bartering works: A business lists a good or service for trade through the barter exchange. In return, the business receives a trade credit based on the dollar value of the good or service offered. It can then use those trade credits to "purchase" goods or services offered by other members.
Be aware that barter and cash transactions are the same in the eyes of the Internal Revenue Service (IRS). Both are taxed equally. In fact, bartering exchanges must report goods and services sold through barter to the IRS.
President of the bartering organization, International Monetary Systems, Ltd. (OTCBB:INLM)
Reprinted from the Letters to the Editor page in the February 2013 issue of Home Business Magazine
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