By telephone, in person, outside the
grocery or department
store or through the mail, we all receive numerous appeals to give to a
variety of organizations and causes. And for many, the holidays are a
time to donate money to those less fortunate.
While it's important to contribute to
charitable causes, the decision to give is a personal one. But
before you decide, you should take some precautions to make sure that
the charity is legitimate. That's because the holidays in particular are
a time when con artists are cooking up schemes designed to take
advantage of your generosity and giving spirit.
Telling the difference between a
legitimate solicitation and a scam isn't always easy. However, some
common-sense do's and don'ts will help you avoid a charity scam. For
instance, often times you may be asked to donate to a local family in
need that may have lost their possessions in a fire or natural disaster.
In these cases, a trustee is required to open a trust account in order
to solicit donations. If you decide to contribute, it's best to give by
check, made payable to the trust fund and not an individual.
Sometimes, you may be asked to give to an
organization whose name is very similar to other well-known
organizations. Are these organizations the same or somehow related? Or
is one totally unrelated to the cause of the other, but just trying to
capitalize on another's organization's good name? And what if you've
never heard of the organization that's soliciting you for a donation?
You also should know that charitable
organizations often will contract with professional fundraisers to
solicit on their behalf. If that's the case, then a portion of the
contributions collected on behalf of the organization will pay the
expenses of the fundraiser. And that will affect the percentage of the
organization's funds that directly benefit the program or charity you
are giving to.
Here, then, are some guidelines and
suggestions to consider before deciding whether to donate to a charity:
- Make sure you know who is asking for
the money and how they plan to spend it. Ask questions, and don't
contribute until you're satisfied with the answers.
- Be wary of emotional appeals.
- Ask the person seeking your donation
whether he or she is a volunteer or paid solicitor.
- Florida law gives you the right to
receive a copy of the organization's financial report before giving.
Ask for it.
- Every organization has some
administrative and fundraising costs. Most organizations can't
function on volunteer help alone, and they must spend money to raise
money. Before contributing, examine the percentage of total revenue
that goes for administrative costs, such as salaries and fundraising
efforts. Then compare that amount with the percentage of revenue
that goes towards the organization's programs and services. Do the
administrative costs seem too high? Does the amount going toward the
organization's programs seem appropriate? Make sure you feel
comfortable with the figures before deciding to give.
- Not all organizations soliciting money
in the name of philanthropy are true charities eligible to receive
tax-deductible contributions. Ask for the group's federal tax-exempt
number. If the group doesn't have one, you won't be able to
legitimately claim your contribution as a tax deduction.
- If the solicitation is for a law
enforcement charity, ask the nearest law enforcement agency if
they've ever heard of the group. If they haven't, chances are it's a
- Never give cash. Contribute by check
that is payable only to the organization, not to an individual.
- Never give your credit card, bank
account or Social Security number to a telephone solicitor. Instead,
ask to have information on making a donation mailed to you.
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