Surviving In Today's Economy Using Trade & Barter. (Part II)
Is it legal to barter? The IRS says; yes! You are suppose to include the "fair market value' of the barter you earn in your gross income for the year and it is taxed the same as cash. You are allowed to deduct barter expenses the same as cash; keep good records. Barter is like cash, you are better off bartering and paying taxes, then not bartering to avoid taxes.
Is trading through a trade exchange legal? Again the answer is; yes! In 1984 the Tefra Act was changed; to include trade exchanges, such as ICRE. Trade exchanges are considered a third party record keepers, on par with banks and credit card companies. ICRE. has to report the gross credits earned by members; using a lO99b form the same as banks are required to report the interest on your savings using a 1099 form. Trading and bartering increase your productivity so much, taxes are a small price to pay for the benefits.
Effective use of trading and bartering can give you an additional 20% of your gross, net! How is this possible? Most companies across America are not achieving their maximum productivity, a lot of companies are only at 60-70% productivity. When this is the case, these companies can increase their productivity "through to proper use
of trading and bartering" as much as 20% without having to increase their fixed cost such as rent,salaries, utilities, etc. That means that as long as these companies collect
their variable cost attributed to this new business in cash; and barter or trade the difference, that barter or trade becomes"net barter or trade in reserve"! Any time the
aforementioned companies spend this net barter or trade dollars on any fix or variable expense, the cash saved (or not spent) goes to the bottom line in the form of "net cash retention". There are a lot of companies that would do business with you under these circumstances, that are currently dealing with your competitor.
How do I know that when I engage in trading or bartering, I won't get ripped off? All you can do is to be careful and use the same discretion you would use if you were involved in a cash transaction. Check references of people you don't know, also look at the quality of their previous work. One of the many benefits of being a member of a trade exchange is, in many cases, the exchange has had some experiences with most of the members. You can also check prices outside the exchange, before you call the exchange. I usually lay my cards on the table when dealing with a fellow members of lCRE. They will generally match or beat a competitive price and accept my credit dollars as part or full payment.
A reader asks: How do I barter or trade for gasoline Traderal? In order to barter for gasoline you must have something to barter with; so make a inventory of your tradable assets or services,include your miscellaneous items and put your cash asking price on the list also. This list could also include goods or services and assets of people that owe you money and are slow to pay you. Make copies and keep this list with you. When you run across someone that sells gas, show or leave them the list. You could have a nice CD player on the list for example; the person that has the gas may want the CD player and not have the cash, but we both know they can give you a line of credit to buy gas.
What happens if I do not have any barter or the gas man doesn't "want anything on my list? That's were trading comes in. You can affiliate yourself with a trade exchange like ICRE. Once you do this everything the exchange has is at your disposal. For example: The ICRE has over 50 restaurants, you can sell the things on your list for credit dollars pretty easy. You can use the credits to purchase anything on the exchange; this really expands your list! Presently the exchange has over 1,200 listings not including miscellaneous items.
But, Traderal Al, what if I don't have anything to trade or barter; I still need the gas! ICRE can still help; since most ICRE members have no cash tied in acquiring their credits and they may have some surplus credit dollars, they are willing to sell their credits for cash. The current purchase rate is 50 cents on the dollar; so you could purchase something from an exchange member, trade it for the gas, and your cash cost could be reduce by as much 50%; stay tuned!