Economic Downturn In Argentina Sees Many Using Barter To Survive
1991, Argentina's peso has been wrestling with economic problems--one
of which is an incredible 21% sales tax! Many have found that barter
is the way around such taxes and the economic slowdown. Since 1995
that has been an enormous increase in the use of barter, both through
organized barter clubs as well as direct trading activity.
the goods/services traded each month is in the millions and growing.
And well it should with unemployment pointing to 15% and one-third
of Argentina's 36 million people mired in poverty.
An estimated 320,000
people have joined some 400 barter clubs. Done a bit differently than
other countries, Argentina's traders meet in vacant lots about the
size of 4 football fields and set up row after row of wooden tables.
It's much like
U.S. garage sales...only no money changes hands. Everyone comes to
barter just about anything they can like canned food for electrical
repairs, a bicycle for the services of a plumber, or garden tomatoes
for children's clothing.
and laid-off bricklayers show up for these weekly barter sessions.
And a commuter bus line offers transportation in exchange for having
vehicles painted. Even hoteliers are getting in on the action--obtaining
sheets and cleaning supplies in exchange for lodging.
For readers of
Spanish, take a look at their online efforts, www.truequeclub.com.
Company BarterFrom Personal Barter
business owners join a trade exchange to enhance their lifestyle.
When doing so, however, there is a way which eliminates any possible
A personal sub-account
with a separate ID in the name of one or more business owners, partners,
stock holders, or employees will receive monthly statements. Sub-accounts
are commission free, as commissions are paid by the "parent"
Sub-Account Establishes Your Personal Account
By using your
company's main account for corporate expenses and establishing a personal
sub-account, you will automatically keep the two types of purchases
on separate statements--thereby simplifying record keeping.
You can set up
a sub-account by calling your trade broker. The IRS has made one thing
perfectly clear: trade dollar income, whether personal or corporate,
is the same as cash taxable income. It should be reported dollar-for-dollar
in the year it is credited to a barter account.
income can fall into any of the following categories:
Keep in mind that
when trade dollars are labeled wages, anyone paid as an employee (including
yourself) needs to have normal withholding taken out of trade dollar
income, and the dollar amount should be added to the W-2.
It is illegal
to compensate individuals as independent contractors (and report income
on a 1099 Form) unless the increasingly strict criteria is met.
Since one person
cannot receive both a W-2 and a 1099 from your company, even bonuses,
commissions, or prize money paid to anyone who also receives a salary
are subject to withholding and get reported on the W-2.
And There. . .