In article specifically geared towards the tax consequences of barter, Kelly Erb says, “Think of barter just like cash: If it would be taxable if paid in cash, it’s taxable if paid in goods or services. If you receive value for goods or services that would normally be taxable to you personally but not as part of a trade or business (such as babysitting income), report it as “other income” on line 21 of your form 1040. If the exchange was part of your trade or business, report the transaction, including income and expenses, on a Schedule C on your form 1040.”

For more on the subject, see the full article at http://www.walletpop.com/blog/2010/02/04/what-are-tax-consequences-of-bartering/

barter, taxes