Every year Americans give trillions of dollars to faith-based, cultural, health, educational, disaster and international relief charities. With so many non profit (non governmental) organizations in the United States and abroad, how does one review charities that are worthy beneficiaries? So just how do you evaluate charities you would like to give to?
When you contemplate making a major or planned gift to your pet charity, what else can you do to ensure that your investment in a charity's future is received with a sense of responsibility and respect? Remember you give to the organization and not the individual who asks you, therefore, if the charity has made the financial grade, there are other strategies you might consider that will unearth how your entrusted assets will be used to advance the agency and its mission!
While a charity review is a must, it is also a good idea to review information about a charity from the state in which the organization is based. Typically the Office of the Attorney General is the venue for State oversight of charities. From New York to Alaska, offices that oversee charities on the state level also monitor registering and licensing. In New York State, all 501 c(3) organizations must be registered. Potential donors and foundations can go on line or phone to inquire whether or not the charity is current with financial reporting or if there are any violations of State laws or regulations.
Practitioners in fund raising such as fund raising consultants, telemarketers and grant writers must all register and be approved by the state as a provider. Charities who hire fundraisers who are not registered with the State are considered to be out of compliance.
If you would like to learn more about the process in your state, call or tap into the Internet site for your Attorney General. To take a look at registration documents for fund raising professionals who work with charities are in New York visit www.org.state.ny.us.charities/charities.html.
Armed with what is required on the state level, donors, charities or fund raising professionals become increasingly aware of the role they play in stewarding donor dollars and charitable assets.
Bonus Note: If you have ever wondered how those telemarketing firms that finally get through to you to ask you for support for your college, police benevolent organization, heart association or cancer society—take a look at “Pennies from Heaven” the annual Telemarketing by Professional Fund raiser review that the New York State Attorney General's Office publishes.
Income tax charitable deductions for gifts and property you have contributed to your favorite causes are just one way the government encourages supporting those charities that impact our world. Whether you are making a gift of $500 or $50,000, you often are reminded that your gift is “tax deductible".
When you take an income tax charitable deduction for supporting non-profit organizations, it is in fact the government's way of encouraging giving. This also acknowledges the role charities play in dealing with poverty, the environment, cultural life and the arts, cancer and other life threatening illnesses.
You can learn a great deal about how the U.S. government influences charitable organization's ratings by understanding more about the tax deduction process.
Trusting your instincts about giving to charity is the first step in becoming a benefactor. Trusting credible and authentic information is the next.
Guide Star provides a great deal of information including 990s, compensation, detailed descriptions of organization, leadership and board members. Guide Star lets you look back at tax returns for approximately five years. Guide Star has advanced membership levels beginning with a basic (and free) service to a fee based membership that provides you with additional information on specific organizations. Guide Star is truly comprehensive and includes any 501 (c) 3 that files a return. Enter the virtual world of more than 900,000 charity ratings by visiting: www.guidestar.org.
Charity Navigator (www.charitynavigator.org.) is a great site! Charity Navigator reviews charities according to efficiency, percentage of fund raising, program, and administrative costs in relation to total budgets, dollars raised and income received. Your “Guide to Intelligent Giving” has a star system with zero raising a red flag to all stars for those who efficiently operate from the financial perspective. Give a little room for some of the organizations that might rank low one year and then pull up the next. Based on how much funding is raised from year to year stars can vanish because fund raising costs might be the same, while an organization might simply have had a bad year for raising money.
Charity Watch is a charity guide program of the American Institute of Philanthropy. Charity Watch grades charities based on the amount of money expended on programs and the cost of fund raising. This giving report card provides contact information, financial performance and eligibility to receive gifts. Take a look at www.charitywatch.org and you will not only be able to assess how individual charities are performing, but also, you'll have the benefit of comparing organizations who are focused on the same causes! BBB Wise Giving Alliance is the result of a merger between the National Charities Information Bureau and the BBB (Better Business Bureaus) Philanthropic Advisory Service, this organization provides information on charities, their mission, programs and services, management and fund raising methods, tax status, financial status, administrative and fund raising expenses as they relate to program expenditures and total assets. When you delve into www.give.org you will also learn about the BBB's Charity Seal of Approval.
If you are one of the more than 225 million Americans who made a gift or a number of gifts to charity last year, you might be more than a little curious about where your money goes and whether or not your generosity is making a difference.
Whether you are a modest donor who gives a number of smaller gifts ($50-$100) on an annual basis, or you are a major donor who regularly makes larger gifts ($500 or more)—it is wise to do a little detective work regarding your favorite cause. Remember, when looking at a charitable organization's ratings, you are looking at a number of performance issues including: