Saturday, January 2, 2010

NPR Commentary on Advice on Making the Most of Your Charitable Dollar

Here's an interesting commentary that played on NPR on December 29, 2009 about making the most of your charitable dollar.  One of the featured speakers is Daniel Borochoff, president of the American Institute of Philanthropy.  His organization is a watchdog group and he certainly puts a slam on Larry Jones' Feed the Children, a charity known to mislead their donors. Read their review here on this  being the "Most Outrageous Charity in America." 

There are some excellent suggestions on what to look for when making charitable donations. There is an excellent list of tips when considering charities.   They rate charities on an A-F scale.  Their suggestions are:

1. Know Your Charity -- Read the annual report and the literature. I would add that it never hurts to peruse a charity's 990.

2.  Find Out Where Your Dollars Go -- Be sure to know what percentage of your gift is used for the organizations programs versus what is used for administrative costs and fundraising expenses.

3.  Do Not Respond to Pressure -- Legitimate charities will give you time to consider a gift as well as send you additional information. Don't fall prey to the high pressure of telemarketers.

4.  Keep Records of  Your Donations -- Don't give cash; don't provide a credit card number over the phone to a charity you are unfamiliar with.  Direct from this site is advice on what to keep for tax records:
"For tax purposes, you will need to keep a record of all your contributions of any amount. For contributions under $250, records may be in the form of a bank record, cancelled check, or written communication from the charity. The written communication may be in the form of receipt or letter that must contain the charity's name and the amount and date of the contribution.

For all tax-deductible contributions of $250 or more, the IRS requires that you obtain a receipt from the charity (a cancelled check will not suffice)."

5.  Remember "Tax Exempt" Does Not Mean "Tax Deductible" -- Request a copy of the charity's tax exempt letter if you question whether they are a legitimate 501(c )(3) organization that allows you to deduct the gift from your taxes.

6. Do Not be Misled by a Charity's Familiar Name -- Some questionable organizations will use a name that closely resembles a more well-known charity.

7.  Do Not be Enticed by Emotional Appeals -- Know the facts by reviewing the literature about the organization.

8.  Ask if the Charity is Registered by Federal/State/Local Authorities --Non-church charities with more than $25,000 in income must file financial information with the IRS.

9.  Beware of Charities Offering Gifts -- Don't feel compelled to give because you receive address labels, calendars, greeting cards or other gifts.  Note that these gifts may increase the organization's fundraising expenses. 

10.  Consider Giving Generously --  If you are satisfied with the charity and determine it to be worthwhile, give generously. 

There are several other good suggestions listed.  I found this to be a solid resource, especially for anyone who continually gets approached by charities that you may have never heard of before.  Mr. Borochoff mentioned in the broadcast that there are a number of organizations claiming to benefit veterans.  Review this information carefully, as many of these are not ranked favorable and practice questionable fundraising procedures.

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