Time Banking (in a Time of Banking Meltdowns)
Here’s a cool sharing concept: Time Banks. The idea is that you give an hour of your time performing a service for someone — say, mending some clothing — and you accumulate an hour in your time bank, which you can then redeem for an hour of bike repair by someone else, for example. This appears to be a growing phenomenon, with Time Bank groups sprouting up here and there. It’s not a new idea, because it’s closely related to the idea of local currency systems, such as the Ithaca Hours currency.
I love the idea of Time Banks, first, because it provides an opportunity for people to experiment with new skills or activities — i.e., do something other than our day job. If I were to join a time bank, I’d probably offer to pull weeds or walk someone’s big adorable dog — or some other healthy break from my usual days spent in front of the computer.
In addition, as the website states, time banking “unleashes untapped community capacity.” It is so true that we live in communities of people rich with skills, abilities, and knowledge. Yet, many of us have a job where we put to use only one or a few of our skills. Time banking could help us tap into that great potential, and encourage us all to grow and develop.
Then there are those people without jobs, which, unfortunately, was a large number last time I checked. Time banking provides new opportunities for the unemployed, people with disabilities, or stay-at-home parents, for example, to get some of their needs met, while feeling like they are making a useful contribution — even without having a job.
The Time Bank website doesn’t say much about taxes, but that’s an important thing to keep in mind. As far as I can tell, the same tax rules apply to time banking as they do to bartering. Even in exchanges where no money changes hands, you may still have to pay taxes on the value of what you receive. In general, casual, one-time, and noncommercial exchanges are not taxed. But if one or both of the exchangers are in the business of providing the services exchanged, you’ll probably owe tax on the fair market value of the service you receive. In other words, if I accumulated 10 hours in my time bank by performing legal services, and I redeemed them for 10 hours of work by a professional accountant, I should pay taxes on the value of the accounting I received. On the other hand, if I accumulate hours by walking dogs and pulling weeds, and receive a little help with bike repair and tree pruning, taxes wouldn’t apply. But it can get complicated, so if you plan to do a lot of Time Banking, make sure you talk to a tax expert to find out what is taxed and what isn’t.