Don't be a jerk -- now or any other time of the year. "I already have this," while true, is not the correct response.
Pick your poison -- say/do one or more of the following:
- "Oh how nice! I love [name thing you already own]."
- Keep it. One for the house, one for the summer house.
- Donate it. Toys for Tots, Amvets or Howard Brown can certainly make good use of it.
- Still in its original packaging? Perhaps you can exchange it for some other crap at some large retailer who's especially liberal with exchanges this time of year.
After some time has passed, don't confess, "Oh, I already had that Rufus Wainwright CD. I exchanged it for Animal Collective." Keep mum.