How to Choose a Legitimate Charity

Although many charities are reputable, there are plenty of scammers who pose as a charitable organization. These con artists create the illusion of legitimate organizations in an attempt to scam cash donations from unsuspecting people. Fortunately, there are some steps you can take that will help you separate legitimate charities from scams.

Instructions

Difficulty: Moderately Easy

Things You’ll Need:

• Internet

1. Decide on a cause. Determine which charitable causes are most important to you. Possibilities include human rights, animal rights, environmental preservation and religious causes.
2. Ask for literature. Whether you've gotten a phone call from a charity or you're researching a charity on the Internet, always ask the organization to send you literature in the mail. This gives you an opportunity to investigate the charity before you make a donation.
3. Review the charity's financial reports. Every legitimate charity should make its financial reports available to potential donors. This report may be available upon request, or it may be posted on the organization's website. The report should tell you how much of the charity's money is actually being donated to the cause, and how much goes toward operating expenses such as administrative salaries.
4. Ensure that the charity is non-profit. An organization must submit Form 990 to the IRS to be considered a non-profit. Ask the charity for a copy of this form.
5. Check with your local Better Business Bureau. If the charity you're considering is local, find the local Better Business Bureau (BBB) in your yellow pages. A quick phone call, email or letter to the BBB will help you find out if the organization has any negative reports.

Tips & Warnings

• The best charities tend to give a large percentage of their funds to the actual cause and use a smaller percentage for administrative costs.
• Choosing non-profit organization helps ensure that your donations are tax deductible.
• The national Better Business Bureau rates some of the larger, national charities.
• In many cases, choosing a local charity will allow you a chance to learn more about the organization. You'll be able to ask friends and neighbors about their experiences with the charity.
• Never give out your credit card or bank information to a charity solicitor who calls you on the phone. This is a common scam tactic.