Save Money -- Turn Clutter into Cash

Save Money-- make clutter disappear--Freecycle.org

Finally for those who just want to get rid of their clutter

Www.freecycle.org

What it is and how it works: This Tuscon, Ariz.-based nonprofit started in 2003 as a grass-roots effort to declutter the world. It has 4.2 million members. The free online service allows subscribers to donate unwanted items to whomever needs or wants them. Users post what they want to give away on the Freecycle message list. Those in need answer back and the two parties arrange for a pick-up. No money changes hands.

Downside:

You don't gt money or a tax deduction.

Upside:

You get to feel good about recycling your old stuff and reducing some of the planet's clutter.

Donations--i.e. to Goodwill or Salvation Army
How donations work:
You donate items- clothes, household goods, etc. -- to a qualified organization and get a federal tax deduction. According to the IRS, qualified organizations include, federal, state, and local governments and organizations organized and operated only for charitable, religious, educational, scientific, or literary purposes, or for the prevention of cruelty to children or animals. Organizations can tell you if they are qualified and if donations to them are tax-deductible. Or you can look that information up on www.irsgov by clicking on Charities & Non-Profits and then Search For Charities.
If your contributions entitles you to merchandise, goods, or services--i.e. admissions to a charity ball, banquet, theatrical performance, or sporting event-- you can deduct only the amount that exceeds the fair market value of that benefit.
You claim your tax deductions by itemizing on Form 1040 Schedule A.
Upside: You are guaranteed to quickly get rid of your stuff--and to a worthwhile, do-good organization. You get a tax deduction.
Downside:You don't get cash. If you don't itemize--two out of three taxpayers don't--you don't get a deduction. You have to keep good records for your taxes. You need receipts for all donations. Receipts must include descriptions for all donations. Receipts must include descriptions of items along with where and when they were donated.
"It's all about getting the right receipts, paperwork and proof," said Dayana Yochim, consumer finance expert at The Motley Fool.

How do you assign value to the goods you donate? The IRS says the value is determined by the resale value of goods you donate. It offers some guidance in Publication 561, Determining the Value of Donated Property. Go to www.irs.gov and type in Publication 561. But the IRS doesn't provide dollar figures.

Goodwill Industries International Inc. and Salvation Army publish pricing guides that Yochim says are good barometers. Go to www.goodwill.org and type in "valuation guide" or go to www.satruck.com/valueguide.asp.

You can also ask your tax preparer to help. Another idea:Walk through a Goodwill store and see for yourself how they price goods similar to yours, said Bill Farmer, head of HTI Tax Service in Lexington, Ky.

The IRS recommends you keep records of how you determined fair market value of your donated goods.

One final note to those getting rid of a lot of stuff: If your total deduction for a non cash contribution tops $500, you must fill out IRS Form 8283. If your donation is worth more than $5,000, generally an appraisal must be done. For more info: www.irs.gov.

Hope these ideas help you remove clutter and save money. Happy Saving!!!