| Tips On Charitable Donations
With more than one million nonprofits in America seeking donors' hard-earned money, and more emerging each day to support victims of this summer's hurricanes, Charity Navigator urges everyone to research their charities before they give. We offer the following tips to help you realize your philanthropic objectives this holiday season
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1. Follow up on tsunami and Katrina donations:
Last holiday season, millions of Americans reached into their pockets and gave generously to help the victims of the tsunami that devastated parts of South Asia. This summer people contributed even more generously to charities providing relief to the victims of Hurricane Katrina. If you gave, now is the time to follow up on that gift. Contact the charity that you supported and find out what the organization has been able to accomplish. As we enter the more expensive and time-consuming reconstruction phase of recovery from both disasters, inquire about the projects the charity is currently tackling. If you find merit in their continued endeavors, make an additional donation.
2. Recognize that 100% of your gift cannot go toward the charity's programs:
In an effort to build donor confidence in their work, many charities responding to the tsunami and other recent natural disasters announced that 100% of each donor's gift would go toward providing relief. That proclamation didn't change the fact that each of these charities still had to pay administrative and fundraising expenses. Donors need to abandon this unrealistic expectation, since each charity must pay for mundane things like utilities, salaries and postage. Instead, focus on supporting efficient charities that allocate at least 75% of their budget on programs and services, around 15% on administration and 10% on fundraising.
3. Do your homework:
Before giving to any organization, make sure it is a 501(c)(3) charity. That means the group has filed paperwork with the Internal Revenue Service (IRS), registering it as a U.S. nonprofit and enabling its contributors to take a tax-deduction for their gifts. However, don't assume that simply because the entity is an established charity that it is operating efficiently and effectively. The IRS hands out nonprofit status like candy, and once a group becomes a charity, the government provides very little oversight at either the federal or state level. Therefore, it is important for donors to do their homework on how the charity really operates.
4. Make a plan:
Now is the time to form philanthropic goals for the coming year. First, determine what causes are most important to you. Next, develop a list of charities engaged in that type of work. Then, using Charity Navigator's advanced search, narrow that list to just a few that are financially healthy and have a donor privacy policy. Finally, map out a plan and budget for the year and let the organization know your intentions. Knowing your plan helps the charity keep its fundraising
5. Don't forget your local and cultural charities:
Around $4 billion in charitable donations was directed to relief organizations responding to this year's natural disasters. History has shown that giving doesn't change much from year to year. As a result, much of the contributions that local and cultural charities were depending on have been diverted to relief charities. If you are passionate about the arts or helping the less fortunate in your own community, consider supporting these groups so that they are not forced to cut programs and services.
This information is brought to you by Charity Navigator
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