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12/23/2008

What�s Happening In Today�s Marketplace...The Use Of Trade Exchanges & Corporate Barter Companies

Part 2

Bartering A Panacea For More Companies In These Challenging Times

The Canwest News Service reported in a recent article that the global economic downturn is driving more companies to barter as cash becomes more precious. That�s especially true for companies that are affected by the lack of credit available in the financial markets. Barter provides a way to keep businesses operating without having to take on more debt.

From a tax stand-point barter transactions are treated the same as cash. In the U.S., trade exchanges (barter networks) are required to file forms (a 1099B is sent to every member) detailing the annual barter sales of members to the IRS.

No such rule (mandatory filing of forms to the Canadian Revenue Agency) exists in Canada. However, in 1988 the Canada Revenue Agency released a statement saying every dollar bartered is equal to one Canadian dollar, and should be accounted for and reported for tax purposes.

Direct Trade In Pensacola Was The Introduction To Barter

Direct trading with a friend or business associate is often the first introduction to barter. Such was the case for two women in Pensacola (FL) recently, when a Mary Kay Cosmetics representative found a local independent photographer who was willing to barter.

Each wanted what the other person had to offer, thus they agreed to trade an hour�s worth of photography services for a selection of Mary Kay products. It�s often difficult to find someone who will trade with you, and you both have a coincidence of wants. But when a satisfactory experience of that nature happens, then one is likely open to the idea of joining a commercial trade exchange...where the membership has a plethora of products and services they wish to barter.

Thanks to a shaky economy, bartering � both on a direct basis as well an through a trade exchange � is growing in popularity.



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