1A

Jim recently joined the Austin Barter Club, an organization that facilitates the exchange of services between its members. This year Jim provided lawn-mowing services to other club members. Jim received the following from the barter club. Determine the amount, if any, Jim should include in his gross income in each of the following situations:

Note: Leave no answers blank. Enter zero if applicable.

Required:

1. Jim received $291 of car repair services from another member of the club.
2. Jim received a $560 credit that gave him the option of receiving a season pass at a local ski resort from another member of the club. However, he forgot to request the pass by the end of the ski season and his credit expired.
3. Jim received a $470 credit that can only be applied for goods or services from club members next year.

1B

Clyde is a cash-method taxpayer who reports on a calendar-year basis. This year Paylate Corporation has decided to pay Clyde a year-end bonus of $1,400.

Determine the amount Clyde should include in his gross income this year under the following circumstances.

Note: Leave no answer blank. Enter zero if applicable.

Required:

1. Paylate Corporation wrote the check and put it in Clyde's office mail slot on December 30 of this year, but Clyde did not bother to stop by the office to pick it up until after year-end.
2. Paylate Corporation mistakenly wrote the check for $180. Clyde received the remaining $1,220 after year-end.
3. Paylate Corporation mailed the check to Clyde before the end of the year (and it was delivered before year-end). Although Clyde expected the bonus payment, he decided not to collect his mail until after year-end.
4. Clyde picked up the check in December, but the check could not be cashed immediately because it was postdated January 10.