Mindy; You advised people to claim bartered transactions on their tax returns as a sale. This is entirely correct, but they also need to record the purchase of the good exchanged for as an expense.
An easy way to do this is to set up an account for bartered things. (Like a paper checking account). You can do this in Excel or QB. Be sure to record your sale of goods as income AND the expense for the item you got – since you purchased it through your sale of writing. That way the expense washes out the income.
For example, you are bartering your writing for a new window. So you would record $XXX as writing income and $XXX as window expense. Because there is no cash exchanged, it is better to keep a separate account rather than run it through your checking account.
Excellent point – thanks, Julie!
I really appreciate your input on that – and it’s certainly important to make sure anything bartered is recorded accurately for tax purposes, which I think is easy to overlook.
So, take note everybody – especially since today is tax day!
I know in Turbo Tax it lets you enter repair expenses made to a home in general, that are then deducted based on the percentage of space a home office takes up in a home, or if it is a repair that affects the home office only, it is deducted as an office expense.
Mindy – I have just been back for a second time to this video. While I certainly find everything that you say of great interest and value – I have to admit that it was your tree full of cherry blossoms that drew me in this time.
We are finally beginning to see a few blades of green grass up here in Alberta and teeny tiny buds on the trees. And it is the time of year when I am literally hungry to get out in the sunshine and to see green again. February, March, and April are very colourless (except for late snow storms which can be beautiful – in a very un-springlike kinda way)and there are people (like my sisters [from UK] – and you[!] who insist on reminding me that I live in a climate that’s far too cold and slow for anyone’s good! But I console myself by looking out of the window at the birds busily flying around with twigs and bit of soft fluff for their nests, my bulbs are now up a couple of inches, and sun is shining today – so spring truly does return each year – I just forget when.
OK – now I’ve got my spring whine out of my system – back to work and thanks for listening! Keep up your great communications! I love reading your blog.
Ann
Awe, thanks Ann! It makes me so happy to know somebody watches the videos. I’m like you – when spring hits, I have a heck of a time staying holed up in my office. That’s part of the reason I keep shooting videos outside. I would have done today’s video outside but the durned wind (Albuquerque’s one fallback) made it impossible).
I hope those bulbs of yours push up high and strong! Here: I’m sending you a cyber-bouquet of lilacs from my bush out back. Thanks for painting such a lovely picture with your description, and thanks for the compliments. I value them greatly.
Heh heh–
You had me worried there for a second that I had asked for 300 pages! I could see myself doing that. Nah, don’t worry about the 300 words. I should revise that to be used more as a guideline. But, especially since you’ve already written it, please feel free to send as-is.
And by the way, congrats on scoring a deal! I can’t wait to read about it.
-Mindy
9 Responses
Mindy; You advised people to claim bartered transactions on their tax returns as a sale. This is entirely correct, but they also need to record the purchase of the good exchanged for as an expense.
An easy way to do this is to set up an account for bartered things. (Like a paper checking account). You can do this in Excel or QB. Be sure to record your sale of goods as income AND the expense for the item you got – since you purchased it through your sale of writing. That way the expense washes out the income.
For example, you are bartering your writing for a new window. So you would record $XXX as writing income and $XXX as window expense. Because there is no cash exchanged, it is better to keep a separate account rather than run it through your checking account.
Excellent point – thanks, Julie!
I really appreciate your input on that – and it’s certainly important to make sure anything bartered is recorded accurately for tax purposes, which I think is easy to overlook.
So, take note everybody – especially since today is tax day!
But I have a question; What if the windows are not a deductible expense. Or only fractionally, when it is in our own home office.
Hmm. Good question – anybody know the answer? If not, I’ll see what I can find out.
I know in Turbo Tax it lets you enter repair expenses made to a home in general, that are then deducted based on the percentage of space a home office takes up in a home, or if it is a repair that affects the home office only, it is deducted as an office expense.
Mindy – I have just been back for a second time to this video. While I certainly find everything that you say of great interest and value – I have to admit that it was your tree full of cherry blossoms that drew me in this time.
We are finally beginning to see a few blades of green grass up here in Alberta and teeny tiny buds on the trees. And it is the time of year when I am literally hungry to get out in the sunshine and to see green again. February, March, and April are very colourless (except for late snow storms which can be beautiful – in a very un-springlike kinda way)and there are people (like my sisters [from UK] – and you[!] who insist on reminding me that I live in a climate that’s far too cold and slow for anyone’s good! But I console myself by looking out of the window at the birds busily flying around with twigs and bit of soft fluff for their nests, my bulbs are now up a couple of inches, and sun is shining today – so spring truly does return each year – I just forget when.
OK – now I’ve got my spring whine out of my system – back to work and thanks for listening! Keep up your great communications! I love reading your blog.
Ann
Awe, thanks Ann! It makes me so happy to know somebody watches the videos. I’m like you – when spring hits, I have a heck of a time staying holed up in my office. That’s part of the reason I keep shooting videos outside.
I would have done today’s video outside but the durned wind (Albuquerque’s one fallback) made it impossible).
I hope those bulbs of yours push up high and strong! Here: I’m sending you a cyber-bouquet of lilacs from my bush out back. Thanks for painting such a lovely picture with your description, and thanks for the compliments. I value them greatly.
Mindy
Mindy, 300 pages or less? I didn’t see that before I struck my deal and wrote the story. I was planning to do a final review tonight and send it over.
I thought about a self promoting sales letter, but I didn’t think I would have time to write the sales letter, do the barter, and write the story.
Any way, do I have to condense the story to 300 words?
Heh heh–
You had me worried there for a second that I had asked for 300 pages! I could see myself doing that. Nah, don’t worry about the 300 words. I should revise that to be used more as a guideline. But, especially since you’ve already written it, please feel free to send as-is.
And by the way, congrats on scoring a deal! I can’t wait to read about it.
-Mindy