We fed them. Bob often bought their kerosine and cigs when they were totally broke. we often cooked, other times She cooked but then had the nerve to throw it up in my face as things were coming to a head. This is funny, she baked a cake, ate all but two pieces of it. Baked another one a couple days later. They ate that one, too. “But I baked those cakes for you. I didn’t have to.”

After a while they both acted like they were being treated like slaves. Yes, we have a nice little set up here, a nice little camper, but we worked for it, all of it.

My husband kicked them out after he caught her snooping and pilfering. It wasn’t pretty. Like they say, no kind deed goes unpunished.

I know this situation is not exactly what you all are talking about but I just wanted to warn people who feel sorry for people who are down on their luck and work out a mutually advantageous arrangement.

We should have known that the reason they were “down on their luck” is because they don’t want to work and thought they should be able to eat our food, use our shower, water, electricity, TV, computer, and pilfer pain pills and still whine about living in a small but comfortable camper.

So be careful. I sure wouldn’t bring anyone into my home. It was bad enough having them in the camper.

This may involve a minimal or a direct trade for services, but all arrangements are contractual and they help with that. The agencies that I know of locally in WA state utilize criminal background checks and compatibility testing for everyone involved, which would probably be a good idea for anyone considering something like this.

Here’s the link to the Tacoma WA agency.

http://shstac-pc.com/

I moved into a couple’s home after my divorce for a bit while I was working on getting back on my feet. The husband was a small business owner and the wife was a community organizer and parents of a seven year old. I called two references and they checked out. Sounds good to me.

They didnt hack me to death, but they decided it was in their best interest to steal my debit card information and clean out my checking account. The proof was the cell phone bill in their name that was paid for and the deliveries of clothes from Macys, and other merchants that matched all of the fraudulent charges.

I would have been better off sleeping in my car.

Others,
I think a lot of the posters are missing the point. Suppose I build a new house and it doesn’t have a lawn. I could hire a lawn company and pay $4800 for grading, seeding, sprinkler system, etc. Or you could simply rent a room out to someone that happens to be a gardener. An easier solution would be to just rent a spare room out in your house for $400 because the odds of finding a gardener looking for a cheap room is pretty low.
“Oh my god, who would have a stranger in their home???”
You people have obviously never been assigned to a random roommate in the dorms or have ever shared a flat with 5 other people, 3 of whom you’ve never met. It’s not that bad and I haven’t heard of anyone being hacked to death in the middle of the night by their Craig’s List roommates. 2 of my friend’s mothers actually had renters move in after their divorces. 1 was a new vet assistant in town and the other was a graduate student looking to get out of the city. These renters allowed both of these single moms to keep their houses out of forecloser.

Also, a code on paper doesn’t have anything to do with “the law.” Law is an older word with a sense of justice and rightness in it. If you think it is immoral to not follow anything written down by a government agency, you’re immoral, and dangerous, and a sucker for tyranny. I am thankful “taxable income” is underreported and some stays in the hands of regular people. It keeps our economy healthier and money useful, instead of being wasted on nothing.

@ Elena # 56 You owe federal income tax on the fair market value of the rent that your employer/landlord waived in exchange for your services as a caretaker.

I’ve followed this thread for a while, now I’d like to stop getting notified of new comments, but I can’t find a link to unsubscribe. Can anyone point me in the right direction?

Thanks,

Chris

EDIT: Sorry, I just found it. My mistake.

I initially did this, rather than pay her under the table, because I wanted to be totally above board, and not have to be concerned about breaking the law. Instead of feeling secure, I’m now worried that I actually made myself MORE obvious to the agencies by paying the taxes, because it’s much easier for them to find mistakes on the taxes I filed than it is for them to find someone who never bothered filing in the first place. And, with how confusing the system was, I’m dreadfully nervous that I *did* make a mistake somewhere along the line.

I can’t imagine how insanely twisted the process for filing payroll would be in a barter system. It was bad enough paying cash. There’s definitely something wrong with a system when they make it so hard for regular folks to be honest and above board. It’s like they actually WANT people to pay folks under the table, so that they don’t have to get involved with all of these “piddling” salary transactions.

But where I get frustrated and eventually decide one can’t look to the law for any indication of what’s fair or right is the IRS’s inconsistency with this stuff. Going back to restaurant servers as an example, the IRS knows they don’t report 100% of their tips – it’s an accepted practice. They’ve never prosecuted this, because it would kill the restaurant industry if they did. The take home pay of servers would fall so much that restaurants would have to pay them more to attract competent ones, and they can’t afford that.

So in order to keep restaurants profitable, the IRS turns a blind eye.

And – having once worked for an accountant for some multi-millionaires – I can assure you that many rich people avoid paying a bit more in taxes than someone who makes, oh, $50k a year. Sometimes even less than that. The IRS knows about this, too.

So to keep the rich rich, the IRS turns a blind eye.

And when you hand out mortgages like candy, exactly opposite your mandate of only giving mortgages to people you know can pay them, you get millions or billions from the Treasury as punishment. Not exactly sending the right message about the importance of following the law in the US, is it?

So while the law is the law even when it’s wrong or outdated, and cheating is never victimless, and I do want the author to realize this, I am at a loss as to how it’s REALLY any different from letting your mother come live with you in exchange for babysitting and some cooking. It’s a false distinction the law is making there – just like the others I mentioned above – and I can understand her frustration. The law IS an ass in this case, I’m afraid.

Also, I wanted to make it clear I wasn’t condemning the author as a person. It sounds like she was ignorant of the payroll tax implications until we brought it up.

Ironically, the difference between having your mother move in and help out around the house v. putting an ad in Craigslist for a stranger to do the same thing is that the law gets fuzzy when it’s family. If it didn’t, homemakers would need to be paid 6 figures by their husbands/wives (what most estimates of a stay-at-home-parent’s “job” would cost if performed by paid professionals).

But the government likes to tax anything it conceivably can without violating cultural traditions. There’s a long-standing tradition of family helping family unpaid – if you suddenly told people in rural Arkansas that they needed to pay their mother-in-laws payroll taxes, they’d laugh in your face. And (as I said before) since neither party is going to report it, they could never catch you anyway.

But with strangers… they could later find out the law, see an opportunity to sue you for SSN payments, and cause you trouble.

It IS inconsistent, and I personally think it’s silly that we’re supposed to pay taxes on bartered services. But the reason the laws exist (if I’m not mistaken – if anyone knows better, please correct me) is because years ago, people paid migrant workers and coal miners in goods or “scrip” that wasn’t worth the labor they were doing – it kept them poor and desperate and powerless to improve their lives, or even stand up to bosses who put them in lethally unsafe working conditions. Because “bartering” on this scale needed to be stopped for the good of many people, we ended up with laws that effect people like you, too.

I don’t personally consider skirting taxes on the kind of money you’re talking about to be so awful. Most restaurant servers skirt a few bucks in taxes because the restaurant just automatically reports a certain percent of your sales as your tip income, and your tips are almost always much higher than that. But the law is the law, and I was concerned that your readers realize that when deciding if this is the right path for them.

“While our ancestors may have exchanged eggs for corn, today you can barter computer services for auto repair. Another example of a one-on-one, non-barter exchange transaction is a plumber doing repair work for a dentist in exchange for dental services. The fair market value of the goods and services exchanged must be reported as income by both parties.”

You are bartering accommodations for gardening services. Here’s the link:

http://www.irs.gov/businesses/small/article/0,,id=187904,00.html

And here is the link regarding property or services in lieu of rent:

http://www.irs.gov/businesses/small/industries/article/0,,id=98895,00.html

Fuzzy math aside, the article makes a good case for those willing or able to consider having housemates. You don’t even necessarily have to look to strangers to fill this void; in my case, my friend and I both needed to save money, she has a big house and I was in an apartment. It just fit.

I’d like to hear from other homeowners with housemates, plus intergenerational households in which relatives or friends provide child care, etc. — how have you handled taxes?

I complain about paying taxes just as much as the next gal, but I do pay. People who do not pay their fair share of taxes are cheating honest folks. Maybe “disgraceful” was too strong a word. Maybe “pathetic” is better.

It’s not “disgraceful”. This is not someone trading a rental unit for services – it’s bringing someone else into your HOME with the expectation that they carry their weight.

Personal Note: When I got my first job out of grad school I rented a room from a young couple. Now, while they only asked for cash in return (no services) several years later they remain friends.

Point is this: if the house of our future permits my wife and I are considering renting out a room. I wonder if Alison or her partner rented a room from someone earlier in life, they had a good experience, and came up with this idea later. Do experiences (good / bad) impact your opinions?

I have a question to anyone, but J.D. in particuluar. I’m 20 years old, nearly halfway through college but am not enrolled right now. I have a little bit less than $2000 of student loan debt to my parents and that’s it. I maxed out my Roth IRA this year. I have a good part-time job which which has good prospects to become full time.

I’d like to purchase a house and know I can afford a mortgage payment between $700-900 a month. I have established credit (good credit card standing).

Do you think I can get a loan for a house around $120,000? Should I even consider purchasing a house at all and just wait until I’m older?

Thanks.

For one, when guest authors submit articles about bartering, they rarely consider the tax implications. Now, I know that most people who barter ignore taxes, and I’m not saying I blame them. But legally, there are tax implications to consider.

Second, I had problems with the math on this, too.

However, I think Alison’s main point still stands. This is a great way to provide mutual benefit to both parties. It’s not something that everyone can do, but there are a few who can. I know a couple of people with “guest houses”. I know even more with extra rooms. (Heck, Kris and I have a house with too many rooms ourselves — we bought this place before we were conscious of that sort of thing.) Renting out a room — or exchanging it for work — is a clever idea.

And while I can’t imagine a $400/month gardener/handyman bill, that’s simply because we let a lot of tasks go undone. If we had a “free” worker, we’d do a lot more pruning, and a lot more home maintenance. My gutters would never be clogged!

But I agree — this isn’t really a savings of $5000/year. It’s not money I would spend normally. It’s actually a trade.

Still, I like the advice, and think it’s worth keeping in mind for the future.

That right there is a good way to save $5000/year — don’t buy (or rent) a house that’s way bigger than you need.

I mean, this post essentially boils down to “It’s so much more affordable to have the hired help live in the guest house than to pay them a salary.”

I don’t have a lot of hired help, nor a guest house, and I make pretty good money. I’d imagine not a lot of GRS readers are in that sort of situation, either.

Now, the idea of inviting a trusted friend of relative who needs free room and board to come in and take care of your kids or run your errands or cook or garden – sure, that could be sweet. It won’t work for a lot of us (no relatives in the area, for example), but it’s definitely something to keep in mind. Then again, this is pretty much how people used to live back before we decided every little nuclear family unit must have its own McMansion.