How to Donate to Charity

Charities are exempt from the 'do not call' government list. That means those pesky telemarketers still calling you are more than likely asking for donations. If you live in a city, you might be approached by street marketers carrying clipboards, asking for donations to a variety of charities. Non-profit organizations are one of the nation's largest employment sectors, so that's a lot of people trying to get your money. There's both a personal and tax benefit to donate, but how do you decide where your dollars belong?

Instructions

Difficulty: Moderately Easy

1. Pick an area for which you feel the most passion. Whether it is health care, environment, education, or poverty, there is an organization out there that works for the general cause(s) you care about.
2. Research research research. There are several links below to use for donor research where you can find information about the number of paid employees and allocation of your gifts: Community programs, administration costs, etc. Things to avoid are organizations spending larger sums on administration than on actual programs, or small organizations with minimal funds whose charitable heads make six figure salaries.
   
   Do take into consideration if the organization is going through a temporary restructure or they are building new facilities. They will appear heavy on the operating expenses, but if you review previous years of annual reports you may find they otherwise spend wisely.
3. Make your money count for more. Tickets to charity galas are usually partly tax deductible, but unless you make additional donations, most of your donation is going towards the expense of the party. Charity walks are popular, but often the gift bag and T-shirt given to registrants are out of hand with expensive 'freebies'. If you want to participate in an event, ask the charity if 20% or less of the money raised will go to the expense. If more than that, you might want to find a different event, even a different organization.
4. Not all non-profits are built the same. You only get a tax deduction for donations to a 501(c)3. Then, if you receive something for your donation - dinner tickets, t-shirts, golf outing - only some or none of your payment is tax deductible.
   
   Capitalize on deductions by estimating taxes before the end of the calendar year and giving an amount that takes maximum limit on charitable giving deductions.
5. How many third parties did it take to ask you for a donation? Telemarketing and mail or street solicitations are typically done by 3rd parties companies that take a percentage (as much as 80% I've heard) of your donation. If you want to give to a charity, contact them and make direct contributions so they see all the money.
   
   Also, the more you give to 3rd parties, the more often your name will appear on their lists. These lists are sold to other organizations, and you can be inundated with requests from approximately every non-profit known to man.
6. Ask for an annual report. These are expensive to produce, so don't expect them to send you one just because you gave $10 last year. If you regularly donate to an organization though, ask to receive the report so you can review where your money is going. It is not uncommon for a new non-profit to be without a report, nor is it uncommon for small or mid-sizes to only produce one every few years. Ask for a back issue if you have to, these reports can offer key information as to their penny-wise penny-fool behavior.
7. Back to the heart of giving: your passion. If you find your charity will spend your money well, then pledge an annual gift so they know how much money to budget for the coming year. And there is no time like the present to portion some or all of your money post-mortem to be sent to your favorite charities.
8. If you still don't know where to donate to, the United Way and several others are umbrella organizations who collect money then send it to other charities wherever they see the need. United Way is not a 3rd party for profit, they are a non-profit themselves and also take direct donations to cover their own operating costs.

Tips & Warnings

• My favorite non-profit: The American Red Cross. Disaster relief is a major part of their work and there are always disasters so they are always in need. But they also do considerable amounts of community programming in everything from the obvious CPR and First Aid, to the lesser known Asthma programs, HIV/AIDs prevention, street safety, senior living, nutrition programs. Their programs serve a big part of the Spanish speaking community as well as offering programs in a number of other languages. The Red Cross is global, known by other names like the Red Crescent, and they aim to touch any community that is under served.