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katzmuu
New Member

If I work for a motel cleaning and in exchange they give me half off on monthly rent amount, is that barter or exchange?

 
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DavidS127
Expert Alumni

If I work for a motel cleaning and in exchange they give me half off on monthly rent amount, is that barter or exchange?

Yes, it is barter for the exchange of services.  You report self-employment income for the value of the rent discount.  In these circumstances, the owner of the motel is required to send you a 1099-MISC with the amount reported in box 7.  But, even if you don't get the 1099-MISC, you are required to report the income.

 

You don't have to send the motel owner a 1099-MISC for the rent you didn't pay if the motel room is for personal use.

 

See IRS Topic 420 Bartering Income at this link for more details.

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2 Replies
DavidS127
Expert Alumni

If I work for a motel cleaning and in exchange they give me half off on monthly rent amount, is that barter or exchange?

Yes, it is barter for the exchange of services.  You report self-employment income for the value of the rent discount.  In these circumstances, the owner of the motel is required to send you a 1099-MISC with the amount reported in box 7.  But, even if you don't get the 1099-MISC, you are required to report the income.

 

You don't have to send the motel owner a 1099-MISC for the rent you didn't pay if the motel room is for personal use.

 

See IRS Topic 420 Bartering Income at this link for more details.

**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
Carl
Level 15

If I work for a motel cleaning and in exchange they give me half off on monthly rent amount, is that barter or exchange?

is that barter or exchange?

You can call it either. But the IRS calls it compensation. If you are a W-2 employee and the value of that compensation is not included in box 1 of your W-2, then as far as the IRS is concerned that compensation is self-employment income that gets reported on SCH C as a part of your personal 1040 tax return.

 

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