The value of clutter can sneak up on you.
We’ve talked about the value of donating versus consigning before. There are plenty of options for auctioning and selling items you’ve organized, but that’s not the best option for everyone.
We recently helped a woman purge 17 contractor bags full of clothes and shoes, many never worn, with tags. She wasn’t a hoarder. She wasn’t wealthy. She wasn’t crazy. She had been battling weight issues for much of her life, and she was getting rid of clothes that were two or more sizes too large, now that she had been at her healthy weight for a while.
At an average of 30 items per bag, at a very conservative $30 retail value per item, she happily disposed of over $15,300 of clothes, many of which she had never worn. We tallied everything accurately for her, donated the items that day to a nearby thrift store, and properly recorded for her taxes.
If you itemize deductions on your US tax returns, you are able to claim the thrift value on your taxes. Thrift value is usually between 20-30%. Remember, over half of her items were name brands, cashmere, and items with tags, so she’ll go with the higher end values for her valuation. So her thrift value then becomes about $4,590 line item on her Schedule A. Please check with your tax advisor to ensure you take this tax deduction correctly.
Sadly, consigning was not an option here.
Assuming that she’s in the average tax bracket, that deduction reduces her taxable income, and could result in a $1,147 reduction in taxes, or cash back in her pocket at tax time.
Of course, this isn’t the end of the story. That one day of work with us means that, after years of getting nowhere, she now has:
- A way to pay for more organizing help.
- The physical ability to get in and deal with needed repairs and the pest problem in that part of the house.
- A completely clear guest room, which allows her to bring in a roommate to help subsidize her house.
- The financial facts to help her understand what her self-professed shopping-as-sport habit is costing her.
We don’t just organize to organize. We really help people stop clutter from sneaking up on them and stop clutter from stealing their money, their space, and their joy.