Friday, November 12, 2004
7 News Features: Fortune Tellers
It's hard to imagine there's an easier way to make money than a garage sale. But what if we told you there's not only an easier way, but a more profitable one. Plus you can still get rid of all that clutter. Here's the nighteam's Lynn Martinez with details in tonight's special assignment report.
WSVN -- If you're looking to cash in, a few financial experts are ready to share a valuable secret.
We call them the fortune tellers and what they found was that by doing a good dead, you can actually make lots and lots of money.
Make a buck, get out the junk.
When it comes to a garage sale, one man's trash is another man's treasure. You don't even have to leave the house to take home the bacon.
Mary: "Yesterday, we made 200 dollars for probably a weeks worth of work."
But there is a way to make more and work less.
Like check out this men's suit. At a garage sale, you're lucky if it'll fetch ya 10 bucks. But what if we told you you could deduct it for $270?
Or how about this sofa. At a garage sale, maybe you'd sell it for 50 dollars? But what if we told you you could make $250?
Carey Rademacher: "If you would just bag up your items, donate them to charity, youre going to save yourself with a tax break, benefit those who are less fortunate, and benefit your community."
Carey Rademacher is one of the fortune tellers.
She works for a company called It's Deductible, developing a computer program that shows you how to turn your household items into fast tax deductions.
Carey: "Every year, people either have a yard sale or they donate their items to charity and they dont bother to keep track of the stuff they give away. the cost is tax savings."
Major tax savings. Carey's motto - why waste time selling for less, when you can just charge uncle sam more.
She suggests donations are the way to go because you can get a hefty deductable... Much more than you'd ever get in your front yard.
Carey: "This is a Guess pair of jeans .. a name brand. They can be worth up to five dollars and they're asking for a dollar for each of these items. They're asking for one dollar this one and two dollars for this one. In good condition you can deduct up to $13 dollars for a picture frame. Here's something that happens all the time at garage sales. this whole box of clothing, theyre asking $50 cents for each article. here's a pull over. In good condition, it can be worth up to $17 dollars. in fair condition, $12 dollars. In poor condition, $4 dollars."
The key is to deduct what is called the fair market value.
Certified Public Accountant randi Grant: "How it was aquired. When it was aquired. What the original cost was and what the fair market value is when you gave it away."
Randi Grant - an accountant who helps people save on taxes - suggests taking every factor into account.
Randi: "I suggest you also include the designer name, such as one pair of whatever designer, blue jeans."
Obviously some designers sell for more than others which means you can deduct more.
Another good way to check the value of an item...See what it's selling for on ebay, or to make it simple .. use the it's deductable program.
Carey: "For example, you gave away women's shoes, I would type in women's shoes. All the possible matches within the software will come up."
Then if you do decide to donate, remember to choose a qualified charity or non-profit organization.
Make sure to take pictures of everything as evidence, and always try to keep good records on hard copy.
Carey: "The irs recommends that you keep in your files receipts from items you drop off at charity."
Mary's convinced. Next year, forget the garage sale, she's heading straight to goodwill.
Mary: "Don't even think garage sale, don't even think I'm going to keep it. Just take it."
Take the money and run.
Mary: "This is the way to go. This is the way to go."
Now, one more deduction we forgot to mention. You can also charge the government the miles you drive to a charity. Try 14 cents per mile.
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