EARN MONEY TO KICKSTART YOUR CAPSULE
Taxes and fashion. These are two terms you don’t often see used in the same sentence. It’s probably best that way.
Lately, when I hear people discuss whether or not they would create a capsule wardrobe I get a lot of this,
“If I get rid of all the clothes I don’t love, I’ll have nothing to wear.”
While this statement might not be entirely true, having only 10 items left in your closet is a valid concern and might result in a minor freak out in which you say something like,
“I can’t possibly afford to buy an entirely new wardrobe, and I definitely don’t have time to shop for it.”
Taxes are kind of strange in the sense that we’ve become so accustomed to having them taken out of our monthly paycheck that it’s hard to imagine a deduction here and there making an impact. I’m here to tell you it does. The next time you’re trying to decide how to sell your clothes to earn a small percentage back, think about a simple donation instead. So here it goes... a lesson in taxes and fashion.
STEP 1: DOWNLOAD INTUIT’S ITSDEDUCTIBLE APP
You’ve probably already heard that by donating your clothes to an organization you can receive a tax deduction. What you may have missed is that there is an estimated value based on the item you’re donating. The ItsDeductible app shows you an acceptable estimated value from the government, for each clothing item.
It breaks down each item into categories that you can select such as Men’s or Women’s Jeans. Then displays an estimate on what each item is worth based on the quality.
STEP 2: BEGIN YOUR CLOSET CLEANOUT
Use the app to let you do a natural closet cleanout. Or, jump in and do a full Closet Cleanout. We recommend that you separate your clothes into two piles. Pile one is made up of everything you love and wear all the time and pile two is everything you don’t.
While going through this process, you can use the ItsDeductible app to catalog items you’d like to donate in pile two. Check off the type of item (t-shirt or jeans etc…) and its associated value (High or Medium).
STEP 3: DONATE YOUR CLOTHES
We recommend finding a local thrift store or checking with local charities like Dress For Success. Then, drop off your clothes. Show your itemized list to the clerk to receive your tax deductible receipt. Last but not least, hold on to your receipt come tax season.
STEP 4: KICK START YOUR CAPSULE
Tax deductions lower your tax basis. In other words, receiving a tax deduction lowers your taxable income. So when you go to file your taxes you’ll owe less based on the amount of money you bring in. Got it? Basically, your income goes down based on your donation (deduction) so you’ll owe less taxes (more money you get to keep).
Every person has what they call a marginal tax rate. (Yawn.) Based on your salary the government has put you in a tax bracket. (Yawn, again.) This can be found here.
For example, let’s say you fall under the 25% tax bracket. If you took the total amount you donated, let’s say $1000 worth of clothes, multiplied by 25% you would receive $250 in tax savings. Let me repeat: you would have made an estimated $250 to start your capsule!
This is money you wouldn’t owe the government or that the government would pay you back depending on your situation. Money you simply earned by donating a pile of clothes you no longer loved. No selling. No fuss.
*Disclaimer: Please consult with your accountant. We do style, not taxes.
HOW TO SELL YOUR CLOTHES ONLINE
To start, selling your clothes can be complicated. Now, you have more options than ever before to sell your clothes. How much time do you want to put into shipping your clothes? Would you rather just drop them off at a local store? Do you want a quick return? Or are you willing to wait? These are all questions worth taking into consideration before making a decision. But first, here are a couple of options.
Selling Unique Items
If you have slightly more expensive or unique taste, Ebay or Etsy is the way to go. They also recently launched Ebay Valet that takes care of the hassle and will accept clothes and other items if you’re in the mood for de-cluttering! Of course you can sell just about anything on either site, but you'll probably have better luck with items that are less common.
If you want to avoid the interwebs and tend to own clothes with mass appeal, try a local Plato's Closet or a similar reseller. Also, we highly recommend selling your clothes to your friends and family on Instagram or Facebook. You'll be surprised how someone's trash is another's treasure.
Finally, there have been a plethora of online consignment stores popping up which make it easy to buy second hand and sell your clothes online. As a heads up, some of these are only available for women. Here’s a quick run down and the percentage you can make by doing so:
- Items listed on ThredUP for under $60 will be paid out upfront. Items that are listed over $60 are paid out once the item sells. Use their pay estimator here.
- The RealReal: You can earn up to 70% of the sale price for your items.
- On each Poshmark sale, you keep 80% of the sale price.
- Tradesy takes 9% of each sale — way less than similar sites.
- Depending on how much clothing you sell, ebay will take 9 to 11% of the final price, after shipping costs. You get a certain amount of “free listings” per month but will have to pay to list extra items within 30 days.
- Free to have a shop, Etsy charges $0.20 per listing and 3.5% for the final cost. Credit card processing is extra and depends on the card the buyer uses.
- ebay Valet: Much easier than selling on your own, however they take only a limited amount of items. They take 20%-40% depending on the final sale price, with items sold above $200 getting the preferred rate.
HOST A CLOTHING SWAP
We believe that less is more and that humans can thrive when they have fewer but better things; by either buying new things that are created wisely or by re-using the things they own. And a Clothing Swap is one way to help us do just that.
Invite friends and family (around the same age) that you love to be around. Have them bring their gently worn clothing items that they've intentionally set aside or have been thinking about donating for some time now in a trash bag or box.
Choose a number
When your guests arrive, have each person drop off his or her items in a designated room and choose a number while mingling. The number determines the order that the guests will present in later. The drop-off room keeps the space free of clutter. The host should always go first to show how it works and put everyone else at ease.
Present your clothes
When your number is up, stand in front of the room to present your clothes. Nothing formal, just have fun with it. You have 5 seconds to show off each item, say the size, and any other details worth communicating such as the brand or that it’s shrunk. This should be a fairly fast process.
Raise your hand
If a guest loves an item, they should raise their hand. The presenter then hands the item over for them to take home.
Or add to the donate box
If no one raises his or her hand, that’s great! The presenter should give the item to the host so she or he can add it to the donation box. Everything left that no one wants at the end of the evening should be loaded up and dropped off at your donation location of choice the very next day.
How to break a tie
If two guests raise their hands at the same time, the presenter chooses a number 1 - 10. Whichever guest is closest wins the item.
TWO SWAP RULES
Judgement free zone
We believe you should never hide who you are--no matter how scary the situation or interaction. There is no room for shame in size, style, or brand. You never know what trash can be someone else's treasure so don't judge!
Less is more
Going home with less than you came with is the point. There's no need to feel disappointed if no one raises their hand. It's actually a wonderful thing! Also, don’t raise your hand for an item you kind of like. You must love it or donate it. It’s that simple.
As hosts we have two responsibilities: making our guests feel comfortable and donating all the items leftover from the swap.
- Set the date + time: Try a weekday night like a Tuesday or Thursday.
- Invite your family + friends: Try using paperless post or eventbrite.
- Choose a place to donate: Check out a local Goodwill or charity.
- Designate a drop-off spot in your home: We suggest a side room or garage.
- Provide snacks + refreshments: Keep it simple or have a pitch-in.
Last but not least, share your photos with us @cladwellteam and use the hashtag #CladwellSwap.