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July 2012
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CONTENTS
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Donating to Charities: Fact vs. Fiction
Make the most of your charitable giving

While many people like the idea of charitable giving, they want to be sure their donations are being used effectively. No one wants their charitable gifts to get lost in the mismanagement of a poorly run organization, or worse, end up lining a huckster’s pockets. Learning some facts about charitable giving can help you make informed decisions about how and where to donate your money.
 
Researching charitable organizations
When donating money, the biggest concerns revolve around how that money will be put to use. You want to choose reputable charities that will use your donation to effectively support your chosen cause, but it isn’t easy to know who to trust. Many people feel safer sticking to large national organizations, without realizing that some of these big names are actually divided into independent local chapters that may operate at very different levels of efficiency. The best way to choose reputable charities is to research them through a watchdog organization like Charity Navigator. Visit www.charitynavigator.org/index.cfm?bay=content.view&cpid=617&print=1 for more information.
 
Charity budgets and expenses
Researching a charitable organization will often show you how much of its budget is going toward program services and how much is being used to run the organization itself. People assume that the best charities use all (or close to all) of their budget on program services. However, it isn’t always that simple. Instead of looking for a charity with very little overhead, look for organizations that offer transparency and a proven record for making a positive impact on people’s lives.
 
Charitable donations and tax deductions
Many charitable contributions are tax deductible, but not across the board. You can only deduct donations to charities and nonprofit organizations with a tax-exempt status. The IRS website makes it easy to search for organizations that are eligible for tax-deductible contributions with the Exempt Organizations Select Check tool. Visit www.irs.gov/charities/article/0,,id=249767,00.html for details.
 
Attending charity events or buying special products
While attending charity events can help raise awareness, they may not be the most effective way to raise money. The same is true of special products that offer a portion of their proceeds to a specific charity. Both of these options do help raise some money, but not as much as a direct donation. When attending a charitable event, consider giving more than the ticket price if you really want to support the organization.
 
Small or large donations
When it comes to charitable giving, many people worry that their donation isn’t large enough to make a difference. Charities depend on donations and will appreciate any amount you are willing to give. If you want to make more of an impact, look at your finances and plan your donations thoughtfully. Instead of giving a few dollars here and there, you can save up some money and donate a bit more to the charities that mean the most to you.
 
Giving to charity is much easier when you feel more confident in how your contributions will be spent. If you take some time to research, you can be sure your money is going to a good cause.

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