K.S.
My son has certain shelves for keeping toys. We keep the smaller stuff sorted into clear bins and the larger items on big shelves. When there is not room for any more then we go through them together and get rid of stuff, as well as toss any broken items. If he has something that he doesn't use anymore but just can't part with it yet, then he can put it in 1 closet we have and then think about it again in 6 months.
We go through toys generally 3 times per year (b-4 birthday, Christmas, and the spring sale at his old preschool).
As for keeping toys for your daughter, I would only keep really gender neutral, good quality, open-ended type of toys. Get rid of anything that is a TV/movie character because that stuff changes so quickly. If she reaches the appropriate age for it and shows no interest get rid of it immediately. Especially if you have too much.
I know a lot of people who keep bins and rotate the toys so there are only a few available each month. I just don't have space where I can make that stuff "disappear" when not in use, but it might work for you.