Barter vs Employee
(Bob H. asks....)
I want to volunteer part time as I travel around the country. I specifically do not want to be paid and I specifically do want free campsite and hookups. I do not want to find at tax time that my volunteering has caused me to incur a tax burden.
I get the impression that a lot of people do this. Is this barter vs employee issue a big deal?
Are potential employers aware of this? Is it just a normal part of doing business or something I must carefully attend to?
Should I address this subject in my resume? Any examples?
I would appreciate comments and opinions.
Coleen, the working while RVing editor replies:
First the disclaimer that I'm neither an accountant or attorney, so I can't give you tax or legal advice. For that, you need to see the appropriate tax expert or attorney.
I think what you should be asking is "employee vs volunteer."
In the land of the IRS, the way I understand it, is that if you are bartering, you are an employee. Employees can be paid with money or with something else of value. When they are paid with something else, it is barter. Work campers sometimes barter for a campsite and utilities. That is, they are employees who are paid for their labor with a place to park their RV and usually utilities. When you agree to work x number of hours for a campsite with hook-ups, it is my understanding that the campground owner is required to report the fair
market value of that campsite with hook-ups to the IRS as income paid to you. Reporting employee's compensation should be a normal, regular part of an employer's business.
Many RVers work as volunteers. The IRS treats volunteers differently than employees. I believe that to be an official volunteer you need to be helping a non-profit, charitable organization or a government agency -- not a private business. It is my understanding that benefits you receive as a volunteer are not taxable. However, on this, I suggest you ask both the agency you are interested in volunteering for and your tax expert.
There's also another factor involved. It seems to be the one that causes the most confusion. Some employers require their employees to live on their business premises for the convenience of the employer. If a campground owner requires this as a term of employment, it is for the good of the campground owner. It is therefore not considered a benefit to the RVer. In this case, the value of the RV site is not reported as taxable income. This is spelled out in IRS Publication 525, page 7. I would think employers would be aware of it. Again, it is always a good idea to check with your tax professional.
You may want to note on your resume that you are looking for volunteer positions only.
When you are communicating with the volunteer coordinator, be sure to ask them about this. You are bound to find some exceptions.
Go to the Workers On Wheels Work for RVers and Campers blog.