Charity Giving Tips and Red Flags
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10 Charity Giving Tips
Red Flags of Common Charity Scams
Giving Tips and Red Flags
There are a number of online resources that can help you research charities. Some provide detailed information about charitable organizations:
Better Business Bureau Wise Giving Alliance
Also, take time to review the organization's own website. Many organizations will post their financials on their web-pages.
Double-check that you’re using the right URL for the right website. Some organizations adopt names to confuse you with well-known charities. Be sure you know exactly who is asking for your contribution. These fraudulent websites will often ask for personal financial information and may download harmful malware onto your computer.
Ask the charity for detailed information. Learn about their programs, and the cost of running those programs. How much does the charity spend on salaries and fundraising expenses? Are there expenses which do not directly support the charity’s mission? These details vary greatly by organization.
Guide Star, Charity Navigator, and the Foundation Center’s 990 Finder allow you to review copies of nonprofits' most recently filed Form 990s. The forms contain useful information on a nonprofit's assets, liabilities, reserves, expenses, and review sources.
Also, take time to review the organization's own website. Many organizations will post their financials on their own web-pages.
The best online fundraising platforms will have clear, easy-to-find information on their websites. These websites should:
- Tell you who gets your donation and how your money gets to the charity or beneficiary you chose.
- State if the platform or another intermediary will keep part of your donation as a fee before sending the rest to your chosen charity.
- State how long it will take for the charity to get your donation.
- State what happens if your donation can’t be sent to the charity you chose, and how often that happens.
- Check if you can choose whether your information is shared with the charity or anyone else.
- Before making your tax-deductible donation, use the IRS online search tool to check the organization's eligibility to receive tax-deductible charitable contributions.
- Once you have made the donation, be sure to get a receipt for your contribution.
If you’re on social media, you’ve most likely have seen posts from people asking for donations.
- Pay attention to who’s asking and who’s getting the money. Don’t assume that a request on social media is legitimate, or that hyperlinks are accurate because a friend posted them.
- Check where the donation link goes. Does it go to a crowdfunding campaign? If that’s the case, any money you give will go directly to the crowdfunding organizer. It’s best to confirm with the person who posted the link that they know the person behind the fundraising.
- If the link is to a charity’s website, research the charity before you donate.
Read Donating Through an Online Giving Portal for more tips and advice.
Crowdfunding is used by entrepreneurs and philanthropists alike to fund a project or an invention. They may ask for contributions as small as $1. Thanks to social media, thousands of dollars in funding can quickly add up for a cause.
Make sure to:
- Do your own vetting.
- Find out what happens to your money if the project doesn’t get off the ground.
- Confirm the production status of the project or program.
- Understand the purpose of the campaign.
- Check who organized the crowdfunding campaign. Does the money go to the organizer, or directly to the charity? It’s best to confirm this in advance.
Scammers can make the caller ID look like their fundraising calls come from your local area code, a Washington DC area code, or from an organization you know. Before you answer, make sure to look at the number provided on your caller ID.
If you receive a phone call from a telemarketer:
- Ask the individual to provide detailed written information about the charity and its program.
- Ask if the individual if they are a volunteer or a paid fundraiser for the charity.
- Call the charity to find out if the charity is aware of the solicitation and has authorized the use of its name.
Do not donate if the telemarketer uses high-pressure tactics, asks for payment in cash, or insists on sending someone to pick up your donation.
- Be cautious of people who contact you online claiming to be a victim.
- Do not respond to unsolicited emails and do not open any attachments to these emails. These attachments may contain viruses.
If you receive an email or text message asking for a donation, confirm that the request is from the charity and not an imposter. Contact the charity or visit its website.
Be particularly cautious of couriers willing to rush out to your home or business to pick up your contribution. If someone wants donations in cash, by gift card, or by wiring money, don’t do it. Avoid sending cash donations. Do not make payments to individuals.
To be more informed and to ensure your good intentions are not exploited, familiarize yourself with red flags of common charity scams:
- Won't provide proof that a contribution is tax-deductible.
- Uses a name that closely resembles that of a better-known, reputable organization.
- Thanks you for a pledge you don’t remember making.
- Uses high-pressure tactics by trying to get you to donate immediately, without giving you time to think about it and do your research.
- Asks for donations in cash or asks you to wire money.
- Offers to send a courier or overnight delivery service to collect the donation immediately.
- Guarantees sweepstakes winnings in exchange for a contribution.
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