• Posts
  • RSS
  • ◂◂RSS
  • Contact

  • Everything is Barter

    December 18th, 2017
    taxes  [html]
    If you drive me to the airport and I give you money, that's taxable. Or if we agree that I'll babysit your kids in exchange for the ride, that's taxable as well, being barter. [1] On the other hand, if you give me a ride to be helpful, and then later I watch your kids as a favor, I think that's not taxable. But I don't see how to draw the line here: instead of transacting in money or direct barter we're transacting in favors or social capital.

    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?

    [1] 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.

    Comment via: google plus, facebook

    Recent posts on blogs I like:

    The Gift of It's Your Problem Now

    Recently a security hole in a certain open source Java library resulted in a worldwide emergency kerfuffle as, say, 40% of the possibly hundreds of millions of worldwide deployments of this library needed to be updated in a hurry. (The other 60% also …

    via apenwarr January 1, 2022

    The container throttling problem

    This is an excerpt from an internal document David Mackey and I co-authored in April 2019. The document is excerpted since much of the original doc was about comparing possible approaches to increasing efficency at Twitter, which is mostly information tha…

    via Posts on December 18, 2021

    Experiences in raising children in shared housing

    Sometimes I see posts about people’s hope to raise children in a group housing situation, and it often seems overly optimistic to me. In particular they seem to expect that there will be more shared childcare than I think should be expected. Today I talke…

    via The whole sky October 18, 2021

    more     (via openring)


  • Posts
  • RSS
  • ◂◂RSS
  • Contact