Sounds like a local merchant complained that gypsies/vagrants were selling merchandise in front of their store (even thought that is *not* the case).
Remember you are in a commercial area/zone even though you reside there.
Did you have anything unusual for sale?
Were you selling any new merchandise that could be perceived as merchandise from a actual store that you own?
Did you have a stoop sale last weekend also?
As far as I can tell, no license is required.
"A person or business that buys or sells secondhand articles in New York City must have a Secondhand Dealer General license...Used clothing stores, garage sales, used boat dealers, and not-for-profit organizations are exempt from the Secondhand Dealer General license requirement."
Garage sales and other similar sales
Most garage sales are not subject to the sales tax registration requirements and the sellers are usually not required to collect sales tax. However, Tax Law section 1115(a)(18) specifically provides that if certain conditions are not met, you may need to collect sales tax, or possibly register for sales tax purposes. See TSB-M-80(9)S, 1980 Legislation-Changes in Dollar Limitation of "Garage Sale" Receipts.
The conditions that must be met under Tax Law section 1115(a)(18) to avoid registration and sales tax collection are:
The sale is at your home.
Neither you (the seller) nor any member of your household is in a trade or business selling similar items. For example, if you own a store where you sell antiques and are registered to collect sales tax, your spouse cannot sell antiques from your home without also registering to collect sales tax.
You make sales for three days or less in a calendar year. Sales on the fourth and subsequent days are subject to tax.
You do not expect your sales to exceed $600 in a calendar year. If actual sales unintentionally exceed $600, the first $600 in any calendar year is exempt. (See Occasional sales from your home (casual sales), explained above, for information on remitting sales tax when this limit is unintentionally exceeded.)
Example: You decide to hold a garage sale at your home that will run Friday, Saturday, and Sunday during a weekend in June. You sort through belongings and decide to sell numerous items including books, children's clothing, miscellaneous kitchen items, and tools. You price most of the items that you are selling under $2.00 each. At the end of the weekend, you count the money and find that you made $175 in sales. These sales are exempt from sales tax because they were not items normally sold by any member of your household; the sale lasted three days or less; and as you expected, sales did not exceed $600.
The purchaser must pick up the items at your home. If you deliver or mail an item to an address in New York State, you must collect the tax on the sale price of the item. See the rules for Occasional sales from your home (casual sales), explained above.
You must collect sales tax, and may have to register as a vendor, if the sales you are making are:
more frequent than allowed by these exemptions,
of greater value than the limits indicated, or
not made from your home.
See Tax Bulletin How to Register for New York State Sales Tax (TB-ST-360) for more information about registering for sales tax.