AOH :: CH10.TXT|
The Benefits of bartering
THE BENEFITS OF BARTERING
With this idea, your job is to cash in on a
billion-dollar industry by uniting the right parties.
The amount of profit depends on your effort. The key
lies in your ability to explain the two most important
benefits of bartering. (And there are benefits!)
First, little or no cash is required for a transaction.
Most bartering transactions are done on a straight
exchange basis. For example, if a CPA needs to get his
house painted, he trades his services for those of a
painter who needs his taxes prepared. Second, there is
always a need for good services. The CPA lays out
cold, hard cash if he can't find a painter in need of
So what's the difference? Why shouldn't the CPA
charge the client for his services? Human nature.
Everyone feels that he is getting a good deal when he
can get something he needs in exchange for a skill that
he possesses. It might only take the CPA a few hours
to provide the painter with the needed tax help. But
for his knowledge and expertise, the CPA gets an
excellent return from the painter. The deal is
negotiated, and both parties are happy.
One of the reasons for bartering's success is tax
evasion. Most people who engage in bartering don't
realize that they are receiving income when they accept
a product or service as part of a trade. Since it is
extremely difficult for the IRS to clamp down on
bartering, most people get away with it. According to
the IRS, the value of bartered services must be
included in gross income.
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