By telephone, in person, outside the grocery or department store or through the mail, we all receive numerous appeals to give to a variety of organizations and causes. And for many, the holidays are a time to donate money to those less fortunate.
While it is important to do charitable donations, the decision to give is a personal one. But before you decide, you should take some precautions to make sure that the charitable donations are legitimate. Telling the difference between a legitimate solicitation and a scam is not always easy. Before you reach for your checkbook, make sure your donations will benefit the causes you wish to support.
Here are some guidelines and suggestions to consider before deciding whether to do charitable donations:
• Ensure you know who is asking for the money and how they plan to spend it. Ask questions, and don’t contribute until you’re satisfied with the answers.
• Be wary of emotional appeals.
• Ask the person seeking your charitable donations whether he or she is a volunteer or paid solicitor.
• Every organization has some administrative and fundraising costs. Most organizations cannot function on volunteer help alone, and they must spend money to raise money. Before contributing, examine the percentage of total revenue that goes for administrative costs, such as salaries and fundraising efforts. Then compare that amount with the percentage of revenue that goes towards the organization’s programs and services. Do the administrative costs seem too high? Does the amount going toward the organization’s programs seem appropriate? Make sure you feel comfortable with the figures before deciding to give.
• Not all organizations soliciting money in the name of philanthropy are true charities eligible to receive tax-deductible contributions. Ask for the group’s federal tax-exempt number. If the group doesn’t have one, you won’t be able to legitimately claim your contribution as a tax deduction.
• If the solicitation is for a law enforcement charity, ask the nearest law enforcement agency if they’ve ever heard of the group. If they have not, chances are it’s a scam.
• Never give cash. Contribute by check that is payable only to the organization, not to an individual.
• Never give your credit card, bank account or Social Security number to a telephone solicitor. Instead, ask to have information on making a donation mailed to you.
