Recently, the IRS reminded small business owners that the fair market value of services or property obtained through barter is still taxable income. Barter exchanges generally are required to distribute Form 1099-B to its members and the IRS, whether operated out of a physical office or through the Internet. Income from bartering is taxable in the year it is performed and may result in ordinary income, capital gains or losses, or nondeductible personal losses. Bartered goods and services used as part of compensation packages are subject to the same employment tax withholding and information reporting as cash compensation.