How to determine if a charity is worth your donation

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charityRequests for charitable donations can seem constant, with someone always asking for money, whether it’s your child’s school, your own alma maters, research and support organizations for cancer and a myriad of other diseases, support organizations for active-duty military and veterans, and more. There are also countless stories about charities that are poorly run, fail to achieve their stated missions, waste money, or worse, are run by corrupt individuals who embezzle the money for their own personal use. And unless you have an endless supply of money, it’s impossible to give as much as you’d like and still have enough money to live the lifestyle you want for your family. But there are some steps you can take to make sure the charities you give to are worthy of your donation:

Establish your own priorities. Some people like giving a little money to many charities while others prefer to concentrate their giving on a few select groups. You should decide which type you are. You should also decide if you want to limit your donations to a specific type of organization. For example, perhaps a close friend or relative has or had breast cancer, so you want to focus your giving to breast cancer research and support organizations.

Narrow your options. Based on the priorities you established, narrow your giving options. A good place to start is with those charities you’re already giving to, or which are already soliciting your dollars. You can use Guide Star or the IRS Exempt Organizations Select Check to verify that an organization has nonprofit status with the IRS. You can also look up organizations on charity evaluators like Charity Navigator or the Better Business Bureau. Just keep in mind that the numbers usually don’t tell the entire story, so if you like a particular organization but are concerned about their rating, do a little digging. For instance, if a charity’s administrative costs seem high, you can call and ask why – sometimes charities classify their expenses in a way that results in a lower rating.

If you don’t already have a list of charities you’re thinking about giving to, try doing a Google search for “best _______ charities to give to,” where you fill in the blank with your priorities, such as “breast cancer research” or “hunger.” If you don’t have specific priorities and are just looking to make an impactful donation, Google “charities worth donating to” – you’ll get lists of charities that you can check out.

Consider the programs implemented by the organizations. Do a little research to find out what impact the organizations are having on their targeted communities. You can Google an organization, contact them or study their website, review their annual report, or even visit them in person. Look for evidence of the effect of an organization’s programs, such as statistics. (Feel-good stories are nice but insufficient to establish real impact without additional evidence.)

If you want a tax-deduction, make sure you get the documentation you need. It’s no secret that charitable giving is tax-deductible, so if you itemize your deductions, make sure you give to a charity that will give you what you need. (The ability to provide such documentation can also be a sign that the organization is well-run.) The organization should give you a receipt or some form of written communication listing the name of the organization, and the date and amount of your contribution. Donations over $250 also require the organization to state whether you received any goods or services in exchange for your donation. (Telephone bills satisfy the record-keeping requirement for text message donations if the bill includes the name of the organization and the date and amount of your donation.)

If you follow the traditional calendar year for your taxes, then you’ll need to make a donation by December 31 to deduct it on your tax return for that year.