Updated June 2016.
While a robin may be the first sign of spring, to me a garage sale is the first sign of summer. Garage sales are full of so much promise. Whether it be the hope of some extra cash or the fantasy of a clean basement, garage sales have a happy, summery feel to them.
And tax-wise, they’re almost never counted as taxable income. That makes them double good in my book. Let’s face it, everything you’re selling at your garage sale is going at a loss. Really. That baby stroller you paid $90 for but are trying to sell for $15-it’s a loss. The $50 pair of jeans that looked so good 20 pounds ago that you’re trying to sell for $10–loss. Since you can’t claim personal losses on your tax return, it doesn’t even get reported.
{Okay, tax technicality: if you sold those items for more than you paid for them, then you should be reporting the sales and claiming the profit as taxable income. But seriously, nobody in my neighborhood is making a profit on their old junk.}
So why am I even writing about garage sales in a tax column? Because after your sale, you pack everything left over into a package for the Goodwill, right? Of course! Otherwise your basement will be a mess again. So here’s my point, when you do that, write down what you packed up and list the prices you put on everything. That way, you’ll have a list of your donations which you’re going to need at tax time.
Too busy right now? Just take a few pictures with your digital camera. Then you’ll be able to look at them when you really need that list for your 2010 tax return. Trust me, come next February, you’re not going to remember what you sent to the Goodwill in May.
So now you’ve got a triple good: non-taxable income, a clean basement, and a tax deduction all rolled into one summertime event. How can anybody not like a garage sale?