I have heard about Timebanks previously, but I never paid much attention to it. Recently I read the post by Chiristian PF on Timbanking and found the idea very interesting, especially given the current economic situation.
What is Timebanking:
It’s simply a “bank” where you “deposit” and “withdraw” time instead of money, all based online. It basically is a community based support network. You sign up and list your skills and things you would like to help with (e.g. painting, typing, driving etc.) when someone in the network requires help in your field, you will be contacted and asked to do the job. The person who requested the help will be “debited” the time and it will be credited to your account.
Example:
You have indicated plumbing as one of your skills, Mrs. Smith requires some plumbing and you provide the service, it takes you 1.5 hours to complete the job. Mrs. Smith is debited 1.5 hours and you will be credited 1.5 hours. You now have 1.5 hours to use if needed.
A few weeks later you need help with gardening so you go online and request help. Mr Gardner comes to do your gardening for you, it takes him 1hour to do the job. You will be debited 1 hour and Mr Gardner is credited 1 hour.
You follow the logic? The more you do for others the more you can get in return.
Timebanks in the News
These timebanks have been around for a while, but with the recent economic slowdown we see more and more timebanks being established. They seem to be more popular in the US than here in Canada, I could not find many timebanks in Canada searching online.
Would you like to get involved or start a Timebank in your community? Check out Timebanks.org
Although timebanks seem to have its critics, I find the concept very intriguing. I think the concept can have many benefits for small communities, the biggest is its networking potential and can help bring community members closer together.
What do you think of this concept? Have you used timebanks before? Would you like to start one?
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In the states (I don’t know about other countries) this is barter, and a bit more sophisticated than just 2 people swapping time. I believe it’s taxable, and with such an organized system, I’d think the IRS would be all over it. I (assume I am a pro) do your electrical work, and you do my plumbing, the IRS wants a cut. Well two, really.
Thanks Joe, thats an interesting point. While I was researching it I never came across any taxation issues, but I can see how the IRS or CRA would want a cut of that. I can not see how they would tax a service provided for $0…any ideas?
Of course I do.
But here’s our IRS view;
http://www.irs.gov/taxtopics/tc420.html
Although quite a bit more long-winded, CRA has same expectation as the IRS in terms of their cut…they even use the same dentist/plumber example:
http://www.cra-arc.gc.ca/E/pub/tp/it490/it490-e.html
Thanks guys!! I was not aware of that!
Interesting concept…
I’m kind of disgusted at the idea that it could be taxed but then again abuse of the system would probably be very prevalent.
Mike
I withdraw my remark. Read a bit more on the site and it seems Timebank has a private letter ruling that since there is no value put on the time, it’s not quite bartering. http://www.timebanks.org/documents/IRSRuling-TimeDollars.doc
In this system, time is time, so if you want to do plumbing for an hour, you can get an hour of someone else’s time. Interesting idea.
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