It can be difficult to figure out which charity is most deserving of your money. Also, how can you make your charitable donations work best for your financial situation. You might already have a favorite charity. If not, finding the right charity can be a difficult task. There are scammers who may want to exploit the best intentions of others, especially around the holidays and during a crisis. Here are some tips to help you.

Check out the charity with a watchdog group

One of the hardest part of donating money is understanding where your money goes. One example is the confusion surrounding Invisible Children, the organization behind Kony 2012. This charity came into the public eye behind a popular marketing campaign. Not long after, there was a very public arrest of one of its leaders after an alleged act of public indecency.

After his arrest, various reports accused the organization of diverting attention from larger human rights issues in the region. They also questioned the financial background of the organization. It’s unclear, even years later, what happened with Invisible Children. The best way to determine whether a charity is a good organization is to check with the three biggest charity watchdog organizations: Charity Navigator, Charity Watch, and the Better Business Bureau’s Wise Giving Alliance. These are all endorsed by Consumer Reports.

Verify each charity’s tax-exempt status

Never assume an organization has tax-exempt status. For example, some universities offer tax-exempt donations for their general scholarship funds and other donations. However, giving to specific departments or organizations is not tax-exempt. Always check with the IRS website at https://www.irs.gov/Charities-&-Non-Profits/Exempt-Organizations-Select-Check.

Always give money directly

One way that scammers will use people’s generosity for their own benefit is to call people and ask for donations over the phone. Don’t assume that someone who calls you actually works for the organization. Instead, hang up and then donate directly to the organization. Even legitimate fundraisers often take 40% of the proceeds. This is keeping your money from the people you really want to help.

Donating directly also gives you more control over the paperwork. This way, you can be sure to get all the documents you need for a tax deduction. You can also confirm the quality of the organization and that the organization is tax-exempt.

Make sure to request privacy

Once you give money to a charity, it’s easy to end up with people calling from other charities. If you ever give money to a political campaign, you probably already know this. In fact, some of our members report that they receive communication from political parties for decades after switching political parties. So be careful! Make sure you care enough about the charity that it won’t bother you to have your dinner interrupted or get junk mail.

Sources:
http://www.consumerreports.org/cro/2012/12/make-sure-your-donation-counts/index.htm
https://www.irs.gov/Charities-&-Non-Profits/Exempt-Organizations-Select-Check
https://www.charitywatch.org/charities
http://give.org/