The easiest way I've found is that anything electronic should go, anything classic and sturdy would most likely be a good keeper. Little plastic things just get brittle and broken over time but solid wooden toys are keepers, the Little Tikes stuff is often a keeper depending on what it is and some of the Fisher Price stuff is also a keeper. Like I kept all the boys LT trucks and all the peek a blocks that we have and all the holiday themed Little People stuff. Although I sold off 99% of our Little People collection because it would be way too cumbersome to store.
Anything they've chewed on or possible drooled into should be tossed for sanitary reasons.
Anything missing pieces should be donated or tossed (puzzles too) since those missing pieces are not going to reappear in storage.
Hopefully that helps in breaking the emotional ties to some of the toys. I know it's very hard to get rid of your kids things but you can always take pictures of the toys and write down little bits and pieces about it (like who's fav it was, who gave it to which child, etc) and then just keep a small flip book or memory box with those in them. Easier to relive the memories when you can just grab a box and look at the pics and notes.
So I plan to make some room and put the "misfit" toys in a section and try to recover those pieces to make them whole. It would be a shame not to try.
Thankfully Target has the pink totes I like to use to sort her toys on sale this week, at least that way I can pretend I'm organized.
More is not always better. 
You don't need to keep them forever. Pick out the ones that mean anything. Perhaps someone actually wrote something meaningful and didn't just sign their name. If this means something to you, and you get warm fuzzies rereading it, then I would suggest that you get a nice keepsake box. I'm thinking a cool trunk-like looking type decorative thing. Designate this as the place that you keep these types of things. It is what I have done for these special momentos. Then, when you are in that mood, you can sit and read through some of the things in the box and smile and remember. Otherwise, seriously, throw them in the recycle bin at your local school or library, it's a fundraiser for them and they get money for the paper in those bins.
Craziness!
I think we know our way around LOL... So please send me some pixie dust to be able to get rid of all the "paper" from Disney
That's my goal and I'm sticking to it. I debated long and hard over some drapes. They were up for about a year, still in almost new condition. They were a heavy material in a deep burgundy. Really nice. I couldn't decide if I'd need them again. Then I thought I am over my burgundy phase. I'm leaning towards lighter colors now. But someone else might be in a burgundy phase. So out they went.
