Bartering doesn't get you in trouble with the IRS, as long as any income you earn from it (be that a cow, an hour-long massage, or sixteen clay beads) gets declared on your tax return at "fair market value". And then, obviously, you pay income tax on it. The IRS will accept just about anything to satisfy your tax obligations, as long as "anything" is US dollars.

The Internet has provided a medium for new growth in the bartering exchange industry. This growth prompts the following reminder: Barter exchanges are required to file Form 1099-B for all transactions unless certain exceptions are met.

See: http://www.irs.gov/taxtopics/tc420.html