You are talking about
bartering. In order to deduct any expenses, you are going to have to report the
income. In reality, you are required to figure the value of services traded and
report that as income. You can ask him what he would have charged for this service. He can use something like the link below.
https://www.sapling.com/8062822/value-used-utility-trailer
Topic 420 - Bartering Income
Bartering is the exchange of goods or services. A barter
exchange is an organization whose members contract with each other (or with the
barter exchange) to exchange property or services. The term doesn't include
arrangements that provide solely for the informal exchange of similar services
on a noncommercial basis. Usually there's no exchange of cash. An example of
bartering is a plumber exchanging plumbing services for the dental services of
a dentist.
Refer to Bartering in Publication 525, Taxable
and Nontaxable Income, for additional
information on this subject. Persons who don't contract with a barter exchange
or who don't barter through a barter exchange but who trade services, may be
required to file Form 1099-MISC (PDF), Miscellaneous Income. Refer
to the Form
1099-MISC Instructions to determine if you
have to file this form.
You must include in gross income in the year of receipt
the fair market value of goods or services received from bartering. Generally,
you report this income on Form 1040, Schedule C (PDF), Profit or Loss from Business (Sole Proprietorship), or Form 1040, Schedule C-EZ (PDF), Net Profit from Business (Sole Proprietorship). If you failed to report this income, correct your
return by filing a Form 1040X (PDF), Amended U.S. Individual Income Tax Return. Refer to Topic 308 and Amended
Returns for information on filing an
amended return.
If you're in a trade or business, you may be able to deduct
certain costs you incur to perform services that you barter.
Refer to Publication 525, Taxable
and Nontaxable Income, and our Bartering
Tax Center page for more information on
bartering income and barter exchanges.
