Hello everyone! I have a children’s secondhand store and we buy a ton of inventory everyday. In return I offer in store credit. I spoke with an Enrolled Agent about how to treat the “sales” when trade credit is spent. I feel like I am bartering some of my clothes and items for some of theirs, but getting the better deal. They told me I need to count the sale towards my overall merchandise sales and pay tax on it. If this is truly the case, I will go bankrupt since I do about $15,000 in store credit “sales” a month and only $8-12,000 in actual cash/credit card sales. Anyone have experience with this? Thank you!
