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Applying Barter Money

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Deb11 Posted: Thu, Mar 12 2009 9:30 PM

We have clients that are Barter clients, which means that when they are billed, their invoices are marked paid in full.  This needs to be done without showing on the register as REAL cash.  I do not have a problem completing this task.  The problem is that the Barter money needs to show up on the Payment Allocation report as income earned under specified attorney.  I do not know how to have this show as earned income with the Barter money showing on my register.  Please help.  Thank you

 

Russell Goetcheus & Velasquez, P.C.

727 W Hargett Street

Raleigh, NC

(919) 754-3904

Deb Williamson
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I believe the best way to handle this is to enter it as a regular payment and then deposit it into a barter bank account. You could also then write "checks" out of the barter account when you re on the other side. This would allow you to see how much you have in barter. For tax purposes barter income is still income. Alternatively, you could enter a credit for the barter amount. You would have to test to see if this shows up on the payment allocation report..

 

Caren Schwartz (Moderator/CIC)

35-45 Consulting

& Time & Cents Consultants, LLC

Southport, CT

www.3545consulting.com / www.timeandcents.com

203-254-7736

Software for Managing Time, Money & Information

Time Matters, Billing Matters, Billing Matters Plus, PC Law CIC

 

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Do you want to report as income for tax purposes, this barter arrangement? If not, you can enter a normal payment as if you were paid a bill, do the bank deposit, then do a General Journal entry crediting cash and debiting the income account that was credited when you 'paid' the bill. You can reconcile both the payment and the journal entry on the register. There are tax rules regarding the value of traded services. You'll want to check with your accountant on how this is best handled, particularly the variance in the value of the work versus the value of what was billed/received.

Kathy Burger PREMIER LEVEL CIC - PCLaw, Time and Billing Matters Plus Certified Kathy Burger Consulting, LLC 200 Windward Ave. Beachwood, NJ 08722 732-279-6301 Kathy@KathyBurgerConsulting.com

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