If you are ruthless about recycling the contents of your closet and take the opportunity to turn clutter into cash, you will succeed. Here’s how to go about ensuring that you will make money, whether it is cash or cash equivalent as a tax deduction. Spend an hour or two going through your children’s closets and your own and congratulate yourself for being honest about what you don’t need, won’t wear, or doesn’t fit anyone. You can take your old shoes that are in good condition along with proper shoe insoles. You can add clothes or anything else that you do not use any more. This is a great way for you do so charity as well.
Consignment for cash
If your items are only one or two seasons old, gently worn or unworn, have a designer or fashion label, then fold them up and make an appointment with a consignment shop. If you live in or near a major city, there will be several to choose from, so match your items to the profile of the store. Some consignment stores want top notch designer labels, others are happy with department store labels, and secondhand stores will accept most items. Most want clean clothing showing no obvious signs of wear, but will not require you to dry clean beforehand. Shoes can show gentle signs of wear, but only slightly, and heels must be unmarked.
What sells best
Consignment shops are busier than ever in these time of economic crunch. Two local consignment shops in San Francisco told me what sells best and what is not appealing to their shoppers these days. Selling well are dresses, shoes, jeans from brands such as True Religion and All For One Mankind, designer handbags, cashmere. The consignment shop owners I met are not accepting outdated looks such as jackets with shoulder pads, some dress suits and pantsuits, shoes with scuff marks or heel damage. My Armani and Max Mara suits were refused, as they are just too old. A black cardigan was accepted but a $100 minimum is in place, so I will need to add additional acceptable items.
Take a tax deduction
If your items are not suitable for a consignment shop, you will still earn via tax deductions by contributing to a qualifying charity shop. Instructions from the Internal Revenue Service are available online. Be sure to ask for a receipt when you donate. Goodwill and The Salvation Army are examples of charities which have tax deductible status. The items must be in good used condition , no holes or tears, but style does not matter.
How much you will earn
I picked up a check for $129.50 this week for items that sold. My local consignment shops offer a 60/40 split, with the majority going to the shop. Some shops still offer 50/50. However, if dry cleaning is required by the shop offering 50/50, you’d be better off going for one that doesn’t other. The Salvation Army publishes a list of donation values to help you plan for deductions. For example, a child’s dress in very good condition is $12, a blouse is $8. Children’s nearly new boots and coats are tax deductible at $20 per item. Keep in mind that contributions must be itemized each calendar year.