The Elf on the Shelf giving basket teaches kids an important lesson about giving back during the Christmas season! Grab a free printable Elf on the Shelf toy donation letter, and set up a laundry basket for this easy elf scene (that also helps to declutter your house!).

Every December, our family’s mischievous little Elf returns to create magical moments and keep the holiday spirit alive. But this year, our Elf is doing more than just getting into silly antics – he’s helping us tackle one of the biggest challenges of the season: toy clutter!
If you’re like me, the weeks leading up to Christmas can feel overwhelming. Between the decorations, the Christmas cleaning, the shopping, and trying to keep the house somewhat presentable for holiday guests, there’s barely time to breathe. And let’s be honest – with MORE toys coming on Christmas morning, our kids’ rooms are bursting at the seams!
That’s when I had a lightbulb moment: What if our Elf could help us declutter while teaching our kids an important lesson about giving back? And the “Giving Basket” was born!
The Magic of the Giving Basket
This year, our Elf arrived with a special mission. One morning, the kids found him sitting next to a basket with a note explaining his plan. The note (which I’m sharing as a free printable below!) asked them to fill the basket with gently used toys, games, and clothes they no longer play with or wear.
The goal? To donate these items to children who might not have much this Christmas.
At first, my kids were a little hesitant. “But what if I want to play with that someday?” (You know, the toy that’s been collecting dust in the closet for 8 months!) But after we talked about how their donation could help another child smile on Christmas morning, they were all in.

Why This Elf on the Shelf Toy Donation Idea is Genius
This simple Elf on the Shelf scene accomplishes TWO amazing things at once:
1. It Declutters Your Home
Let’s face it – kids accumulate stuff at an alarming rate! Between birthdays, holidays, and those random impulse buys at Target (guilty!), our homes can quickly become overrun with toys that no longer get played with. By having your kids actively participate in the decluttering process, you’re making space for new gifts while teaching them that it’s okay to let things go.
Much like my magic basket method for quick daily cleanups, this donation basket becomes a focal point for organizing. Instead of you nagging about cleaning their rooms, the Elf makes it a fun, purposeful activity!
2. It Teaches Kids About Giving Back
One of the most valuable lessons we can teach our children during the holidays is that Christmas isn’t just about receiving – it’s about giving, too. When kids see that their gently used items can bring joy to other children, it helps them develop empathy and gratitude.
My daughter actually got emotional when we talked about a little girl who might receive her favorite stuffed animal (that she admittedly hadn’t touched in a year). “She’ll love it as much as I did, Mom!” she said. My heart just about burst.
This activity naturally opens up conversations about appreciating what we have and being mindful about how fortunate we are.

How to Set Up an Elf on the Shelf Toy Donation
Setting up this toy donation Elf scene is super simple! Here’s what you’ll need:
- A basket or bin – I used a medium-sized woven basket that I already had, but you could use a laundry basket, a cardboard box, or any container that works for your space.
- The free printable Elf note – Download and print the elf toy donation letter (included below!) that explains the mission to your kids.
- Your Elf on the Shelf – Position your Elf next to the basket with the note.
That’s it! I placed the basket and note in front of our Christmas tree where the kids would see it first thing in the morning.
The Elf’s Toy Donation Letter (Free Printable!)
Here’s the rhyming note that our Elf left for the kids. Feel free to use the free printable Elf on the Shelf toy donation letter (at the end of this post), or modify it to fit your family’s needs!
Hello, my dear friends, I’ve come back to say,
It’s almost time for Christmas Day!
But before Santa comes with presents and cheer,
There’s something important we must do here.
Look around your room at all of your toys,
The games and the clothes for girls and boys.
Are there some things you no longer use?
Some items that you could give and choose?
Fill up this basket with things you don’t need,
Toys, games, and clothes—what a wonderful deed!
We’ll give them to kids who don’t have very much,
Your kindness and love will mean so, so much.
Before new toys arrive on Christmas morn,
Let’s share what we have, so joy can be born.
Give with your heart, appreciate what’s here,
And spread Christmas magic and holiday cheer!
Love,
Your Elf
Tips for Making This Activity a Success
- Start Small: If your kids are overwhelmed by the idea of parting with their belongings, start with just one category. Maybe ask them to find 3 toys or 5 pieces of clothing they’ve outgrown.
- Get Specific: Help younger kids by asking questions like, “Do you still play with this?” or “Does this shirt still fit?” Sometimes they just need a little guidance to make decisions.
- Praise Their Generosity: Make a big deal about how proud you are of their giving hearts. Talk about how excited another child will be to receive what they’ve donated.
- Follow Through: Make sure you actually donate the items! Take your kids with you to drop off the donations if possible, so they can see the impact of their generosity.
Where to Donate
We donated our basket of items to our local church’s toy drive, but there are so many wonderful organizations that accept gently used items:
- Local shelters and churches
- Goodwill or Salvation Army
- Schools and daycare centers
- Community toy drives
- Organizations like Toys for Tots (Note: they prefer new toys, but many local chapters accept gently used items)

Download Your Free Printable Elf Note!
This Elf on the Shelf decluttering activity has become one of my favorite new traditions. It’s meaningful, practical, and perfectly captures the spirit of Christmas. Plus, let’s be real: a decluttered home means less stress for us parents during an already hectic season!
If you want to try this Elf on the Shelf idea with your own kids, then I’ve created a beautiful printable version of the poem that you can download, print, and use to create your own Giving Basket! It’s sized to fit perfectly next to your donation basket, and I’ve even included a matching “Toy Donations” sign.
Just click the link below to download your free printable Elf on the Shelf toy donation letter! And in return, if you could PIN this post to your Christmas board on Pinterest, I would greatly appreciate it!
Download The Printable!
Click below to download your FREE Elf Toy Donation Letter:
