In the old days
Before the current cycle of anti-gun hysteria, many police agencies routinely sold off confiscated "crime" guns to dealers (usually at auction), as long as they were otherwise legal. Sawed off shotguns, machine guns, etc., were destroyed (some examples wound up in police collections, some even in police use) but rifles, shotguns and handguns were often sold after disposition of the cases was finalized.
Starting in the 60s, many major metro police depts and state police in some states adopted a policy of destroying the guns, usually after a case where one of the guns sold by the police was involved in another crime. Politicians and others decided that it was important to ensure that the guns didn't get back on the street, so they stopped sales to the public (dealers).
back in the early 70s in New York state, we found out (as a result of a traffic accident) that if the pistol permit holder died, the pistol(s) would have to be surrendered to the police. If they were turned over to the State Police, after 60 days (IIRC) they would be destroyed. If they were turned over to the local sheriff, and a permit applied for, they would be kept until the application was either approved or denied, and if denied, then they would be destroyed.
Over the years more and more agencies have stopped selling siezed guns and are having them destroyed. Your tax dollars at work.