Note: These tips are for non-profit organizations based in the United States.
It may sound horrible, but there are fake organizations that are out there trying to get donations but aren’t doing the good deeds they claim. Here are a few tips and resources to help you find an appropriate non-profit to support with your money or time:
- Don’t donate through telemarketers or other third-party fundraisers. These fundraisers typically keep some portion of each donation, so more of your donation will go to the cause if you donate directly. It is recommended to never provide your credit card or bank account number over the phone unless you initiated the call.
- Research before making a donation. Don’t just donate to everyone seeking funds. Instead find causes you have a passion for, research the organizations supporting those causes and then donate. I have provided some resources for this research below.
- Keep records of your donations. If you wish to receive a tax deduction for your donation, ensure that your donation fits within IRS rules and you have keep appropriate records of your donation. Here is some information from the IRS website: Donation Tips and Donation Rules.
- Trust your gut when making a donation. If they seem too good to be true or anything seems fishy, trust your gut and find a similar organization to receive your donation. If an organization is pressuring you, not disclosing their finances, or not willing to provide you details of their programs, they are likely not a valid charity.
- An Internet search for the charity will also typically give you a good idea about an organization.
- Great Nonprofits is a website that allows people to post reviews and ratings of websites that have impacted them. People who rate nonprofits on this site have donated their time or money or benefited from their services.
- Charity Navigator rates nonprofit organizations based on their financial health, accountability and transparency. You will only find larger nonprofits on this site since they only review organizations who receive public support over $500,000 and total revenue over $1,000,000. They also require four years of IRS records before they will review an organization.
- GuideStar pulls together IRS records with other financial data and information provided by nonprofits.
- Better Business Bureau Wise Giving Alliance is a division of the Better Business Bureau which provides information in national charities.
- If you have been scammed or suspect a scam, contact the Federal Trade Commission at ftc.gov/complaint or 1-877-FTC-HELP.
Do you have additional tips to share or other resources that should be included above? Please share them in the comments.