As a freelancer, there will be times in your career where time is a lot easier to come by than cash. That means that trading some of your working time for something you need directly ? rather than taking the long way around and trying to earn the money first ? can make sense. Bartering some of your work for what you need can be a useful way to get it.
Bartering services can be especially useful when you?re just starting your freelancing career: if you need some help with a particular part of your marketing materials, approaching another freelancer and simply offering to trade can get the job done.
Finding Someone to Barter Services With
There?s a reason people use cash, rather than barter exchange, for every day transactions. It can be tough to find someone who not only has what you want, but needs what you have. There can be marketing involved, just like landing a client with cash ? but there?s also just as much networking and bargaining.
It?s often useful to start out from the point of view of what you need ? rather than waiting until someone offers to barter with you. If you know exactly what you need, approaching someone who offers that service or product directly with an offer can get you a lot closer to a done deal than trying to spread the word that you?re willing to barter.
The Other End of Bartering
If someone comes to you with an offer to barter, give the situation some careful consideration: is the other person offering something you actually want or need? Is there something else you need that the individual in question can offer? Don?t be afraid to negotiate.
It can be worthwhile to keep a list of what you?re willing to barter with, just as you might keep a price list for the different services you can provide. You never want to wind up in a situation where you?re not receiving fair value for your work, whether you?re bartering or looking for cash. It can also be worthwhile to establish a cash value for both ends of your bartering agreement, so that you?re both clear that the arrangement is fair to each participant.
Handle Your Barter Exchange in a Professional Manner
If you do choose to barter your services, it?s important to handle such work just as you would a project for a paying client. It?s easy for either side of a barter arrangement to take the matter a little less than seriously, creating the potential for a problem.
Write up an agreement of what is involved in the project, deadlines and any other expectations and sign it. That way you will at least start out on the right foot when it comes to treating any barter work completely professionally.
In short, you should handle a barter arrangement no differently than you would handle any other client. The only thing that should not be identical to a regular gig is the method of payment.
Keeping Your Barter Clean
In the U.S, as well as some other countries, we?re supposed to report barter on our taxes ? not a lot of people actually do it, but I?d never tell you to do otherwise. Because you receive a benefit from bartering, the IRS views it as a type of income and expects you to report it as such. There are specific types of barter that the IRS handles in different ways.
Especially if you handle a significant amount of barter work, it?s worthwhile to speak to a tax professional about what your obligations will be. It?s also important to keep track of barter, just as you would any other type of income.
Photo credit: Some rights reserved by Icon Eden.
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