When there is an opportunity for your barter goods or services with another business owner, you must make sure that the exchange is win-win, as well as of comparable value.
Here’s some good information from the New York Enterprise Report.
Bartering for products and services can be very beneficial. Barter exchanges (trades among persons or organizations other than informal exchanges on a noncommercial basis) have a positive impact on cash flow ? businesses do not need to spend cash to acquire the goods or services needed by a business (preservation of capital). Bartering also is a way to get rid of excess inventory.
However, as with any other transaction, barter is taxable. Any exchange of goods or services without money is treated as a barter transaction. Swaps, trades or exchanges are taxable transactions. The fair market value of goods and services exchanged must be included in the taxable income of both parties.
Fair Market Value
When using barter as a method to get rid of excess inventory or remnant goods or services, both suppliers involved in the trade have to agree to the value of the services or products, and that value will be accepted as fair market value.