Is it legal to barter?

I have a friend who went to a trade show for his parents’ hotel - they met with airlines, food suppliers, houseware manufacturers, etc, and everyone would trade items. For example, an airline may need hotel rooms for its delayed passengers, so it would offer 1 free round trip ticket to the hotel if they provided 5 hotel rooms.

Would it be legal for me to offer someone a free hotel room in return for 50 pounds of shrimp? Both parties would win because items would be traded at cost, tax free. It seems to me the government would be upset over all this loss of income since taxes would be avoided. It appears that everyone wins but the government, which most people won’t shed too many tears over (since sales tax in my state is now 9.25%).

And, if legal, would there be a market for a “Barter” website? (no one steal my idea, I’m copywrighting it!).

Too late!

http://www.barteringconnection.com/

Yes, but you are supposed to report it as income and pay taxes on it.

Unfortunately, the IRS only accepts money as payment.

Darn it!!! I thought I had a good idea. Just like my original two-sided penut butter jar that I saw some kid show off as his science project on Jay Leno years ago. Oh well, I guess everything’s been thought of under the sun. Thanks for the info.