Everything is Barter
|December 18th, 2017|
In some cases I think it may come down to whether we make an explicit agreement vs doing things informally. If I let a friend live with me because I have a spare room, and then they decide to spend weekends fixing up the house out of gratitude, I think that's not taxed. But if we explicitly agree that I will waive rent in exchange to 12hr/week of house repairs that probably is taxed. Penalizing people for being explicit in their interactions with each other seems harmful, though, as clarity in expectations can be a good way to reduce conflict.
Other things seem even messier. What if I take a job that pays less because I value the experience I'm gaining. What if it's for the fun? Prestige? Social impact? Or imagine I live in the US and want to donate to a charity that's tax-deductible in another country, and you vice-versa, so we each agree to donate to the other's charity. Or I agree to give up eating pigs in exchange to your giving up eating eggs. Is any of this taxable? Should it be?
Mostly I'm just pretty confused. I think it's possible that lots of things are technically taxable but most people don't report them and the IRS doesn't really expect them to be reported?
 Barter in the US is taxed as if we had each performed our services for "fair market value" in money. So if $50 would have been a fair price for the ride and for the babysitting, we each report an additional $50 of income.
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