We have a Mission Store at our church for the homeless. They have clothing available for kids and adults and even work clothes for interviews/work-dress. We go to First United Methodist Church-downtown Fort Worth. That's what I do with some of my child's clothing.
I also donate some to United Community Centers (there is 3 of them in Fort Worth). They are located in low income areas and it is similiar to the Boys and Girls Club, however they teach kids about God and Religion. They have a clothing closet and always need clothes and hangers there. It is a neat place, we've donated our time to volunteer there with our Women's group at church. They also give out food to families that need it. They help the kids with their homework and work with the schools.
If you are interested in donating clothes to the United Community Centers go to www.unitedcommunitycenters.org or I'll be glad to talk to you more about it.
In addition, we are Foster Parents and All Church Home has a clothes closet for Foster Children. They always need donations, many of these kids come with no clothes or very little clothing. The clothing closet is for foster parents when they first receive a child. If you would like for me to take them, I can pass them on to our Foster Agency also.
With my Son's clothes, I keep the ones that family have given us and really cute ones that I want to save.
I've tried Kid to KId/Mudpuppy and they don't give you very much for the clothes. Just Between Friends you get more money, however the next sale is in the Spring. Just Between Friends, you have to print a tag/label on each piece of clothing. It is more work than a consignment store. However, you get 65%-70% back to you. You get more sometimes if you volunteer to help out at the sale. If you have the time to make the tags and get your clothes ready, then you could do the sale in the Spring. I've done it and what I don't sell I donate. Just Between Friends website is www.jbfsale.com
If you need the extra cash, then I would do the consignment sale with Just Between Friends or Divine Consign (this is another sale). If you don't need the money or don't have the time to sell your things, then I would definitely donate them.