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I have a garage full of stuff (furniture, baby items, books, etc all in pretty good condition). We can either have a garage sale or donate the items to charity and claim a deduction. What is the best choice? We own our home, we contribute at least 10% of our income, I am also an independent contractor (1099 form)so I deduct expenses, mileage, home office etc. Thanks in advance!

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Without knowing exactly what you have it would be tough to say, but I'll tell you this, garage sales are a big time commitment, much more than I would have thought.

So I'd say if you have things that you think those less fortunate might be able to use, donate, take your deduction, and save your weekend.

How about a combination of eBay and donations? eBay anything that's media, maybe in lots of 5-10 items, since USPS media mail is inexpensive. eBay anything that's worth more than $15 and can fit into a standard priority mail box or weighs less than 2 pounds. Donate the rest.

donation you get around 25% of the value back in cash

find a charity that lets you put the value down on paper and then they sign off on it

I've often thought of the same question you ask. I concluded that the hassle of a garage/yard sale is just too time consuming to do, when I can get basically 33% of the "appraised value" (what I think the stuff is worth--reasonably so,of course) in tax refunds.

Gave a freezer away to Habitat for Humanity recently. Worth around $270, tax refund = ~$90, which is probably not too much less than a yard sale would bring.

Just my 2 cents.

Jim

clemente21 said: [Q]How about a combination of eBay and donations? eBay anything that's media, maybe in lots of 5-10 items, since USPS media mail is inexpensive. eBay anything that's worth more than $15 and can fit into a standard priority mail box or weighs less than 2 pounds. Donate the rest.

I'll just say this....EVERY time I've went to the post office and sent via Media Mail..I ALWAYS have gotten the evil eye...and more often than not..the third degree...Once about 2 month ago my pkg never even made it to the destination!!

I don't know what the big deal is with them. I've mailed from at least 4 or 5 different locations and everyone of them has done the same thing...and no...not the typical quesitons..."any coorespondence inside , etc..."

p.s.

if you donate and it's above $250...you should read the irs guidelines for giving and what proof you need...else you won't be getting those deductions. That said, I'm not sure how personal deductions like that will help your situation...since I'm now sure how the irs will look at gifts given by you personally and deducted from your 1099 income. And since you don't have a house loan...you aren't itemizing persay as most ppl would w/ a mortgage....

dg

teplitsa said: [Q]donation you get around 25% of the value back in cash

find a charity that lets you put the value down on paper and then they sign off on itDoesn't matter what they sign. You are personally responsible for justifying value to the IRS

dgoedken said: [Q]clemente21 said: [Q]How about a combination of eBay and donations? eBay anything that's media, maybe in lots of 5-10 items, since USPS media mail is inexpensive. eBay anything that's worth more than $15 and can fit into a standard priority mail box or weighs less than 2 pounds. Donate the rest.

I'll just say this....EVERY time I've went to the post office and sent via Media Mail..I ALWAYS have gotten the evil eye...and more often than not..the third degree...Once about 2 month ago my pkg never even made it to the destination!!

I don't know what the big deal is with them. I've mailed from at least 4 or 5 different locations and everyone of them has done the same thing...and no...not the typical quesitons..."any coorespondence inside , etc..."

When asked, I use a monotone voice and quote directly from their guidelines.

For computer media, say, "Computer-readable media containing prerecorded information and guides or scripts prepared solely for use with such media."

For movies, say, "Sound recordings, including incidental announcements of recordings and guides or scripts prepared solely for use with such recordings. Video recordings and player piano rolls are classified as sound recordings."

When asked if there's any correspondence inside, say, "Instructions and directions for the use of the item mailed."

I tried the garage sale ONCE! That was enough. My stuff, which was typical used stuff, did not sell. I only made any money because I was selling a fridge, tv, old game system. Clothes, books, household items did not sell...and they were priced to move!

Now, if it doesn't have an eBay value, it goes to the donation pile. I use the Deduction Pro software from H&R Block. I think it was posted here. It was free for 2005, but they want me to upgrade for 2006...so I just put in my stuff for 2005 dates then save the file. Its an XML file and I can open it in excel, then I change the dates, pretty it up and have the clerk sign it with my receipt.

I second the use of Deduction Pro.

It often times gives me a higher value than I would have put on an item. It is from a known 3rd party that would stand up a lot better to the IRS than MY opinions on what a used item is worth.

I would make a detailed list with Deduction pro and either have someone come pick it all up, or drop it off somewhere.

You'll probably come out ahead this way, plus you get to feel good about helping out a bunch of families that couldn't afford the things you are giving away.


Here's what I would recommend. YMMV.

1. Advertise for a garage sale in your local paper for Saturday morning from 8:00 a.m. to 1:00 p.m. List the major/large/unique items in your ad.
2. Call your favorite local charity and schedule a pickup for Saturday at 2:00 p.m.
2. Do not clean, dust, or price anything unless it's in really crummy shape.
3. On Saturday morning at 7:30, roll up your garage door and start setting stuff out. You will have "earlies".
4. Sell stuff. Collect cash and checks from trustworthy looking people.
5. Between 1:00 and 2:00, put back the stuff (if anything) that you have regrets about giving away.
6. Load up whatever doesn't sell into your local charity van at 2:00 p.m. Get an itemized receipt and write on it your estimated value of the stuff.
7. Go to the bank and deposit your cash and checks from step 4.

Results: low hassle, high cash, clean garage.

2Cor521

Have this place do it for you, YMMV, requires "valuable" stuff, only certain areas, probably many applicants, I'd give it a try if they were in my state though, Text

I also recommend the use of a program like Deduction Pro.

Many people have no way to justify the value of the items they declare as charitable donations because they have no clue about depreciation and how to factor in the condition of the items. Without those, you could be hard pressed to justify some of the values if audited.

As far as sell vs donate, the easy answer for me is usually determine depreciated value via DeductionPro (being generous with condition), divide that by 4 (25% tax rate) and compare with what I think I could sell the item at. If it's a close call donate >>> sell based on hassle factor.

As far as organizing garage sales, if you're not in a hurry, the cheapest way is to look for garage sales already advertized in the paper and having your stuff out when the neighbor 4 houses down has his. They paid for ad insert and you'll get just about as much traffic. People going there will see your own sale and most likely check it out too. Also look for community garage sales if there are any. Those provide a lot of foot traffic so chances to sell stuff are pretty good.

As far as not cleaning stuff, I wouldn't recommend it. Dirty stuff looks like it's not gonna work or hasn't been cared for and thus isn't a good deal or will sell for less than it should if clean. Some stuff like clothes aren't worth washing since people will wash them anyway but dusting off things quickly doesn't take much time and really increases chances to sell. If you do the math of stuff that is barely worth selling over donating, it won't be that many items anyway.

Now that's a specific example but for baby clothes (brands especially), you can get quite a bit back selling them on eBay as bundles assembled by age/season. Makes one big box, people will effectively buy stuff they may not have along with stuff they want in your bundle and you still charge them for the whole thing. Shipping isn't a big deal in those sales since the clothes are tiny and not fragile so as a bundle it doesn't raise the price much per item vs a garage sale. Difference is you get a lot more targetted exposure.

DeductionPro can be downloaded free here:

http://www.hrblock.com/assets/partners/dpro_giveaway.html

we did craigslist.org and sold about $300+ worth of stuff and the local "mega garage sale" was only 9 familes in a gym with maybe 100 people there. (flyers were said to goto 50k) anyways, we only sold about $125 at the sale.

$300+ people came to our house over the course of 5 days (we were home anyways) verus $125 for putting everything in the truck, driving to the gym, settings up, taking down, bringing everything home etc etc.


A similar program is ItsDeductible, which works with Turbotax.


I haven't had a garage sale in 15 years - too much trouble for not enough money. Much easier to haul the stuff to the Salvation Army every few months. I jot down a list of the items and snap a photo of the pile for further documentation. In each of the last 10 years I have routinely donated stuff valued at $500-$1000 which requires an extra form attached to my tax return. I haven't been audited but would expect my documentation to hold up to scrutiny (for valuation I print the guides available at charities' web-sites). I'm glad I saw this thread - think I'll try Deduction Pro this year.

You can also sell stuff on craigslist -- depending on the market, you can sell your baby gear there. Also try half.com for media items.

Please remember to take down your signs when your done. <img src="i/expressions/face-icon-small-smile.gif" border=0>



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