The Richmond Register

November 28, 2012

Make your charitable giving count

By Gina Noe
Extension Agent

RICHMOND — It is the holiday season, a time many of us associate with giving. This year it coincides with one of the largest natural disasters our country has seen, Hurricane Sandy. There have been many opportunities to give to the victims of Sandy, and there will be more.

Unfortunately, some donations intended as charitable donations end up in the pockets of fraudulent solicitors. Scammers abound at times of tragedy. To make the most of your charitable giving, carefully research charitable organizations before donating.

Most people who give to charities don’t know that the law does not regulate the percentage of funds that a charity must use for its cause. Many charities spend as much as 75 percent of donated funds on administrative expenses and raising more money. Many charitable organizations use professional solicitors to raise funds. This practice is legal, yet some professional fundraising organizations keep an exceptionally large percentage of the donated money.

Under Kentucky law, solicitors are required to tell you that they are paid fundraisers.  Solicitors often ignore this law, so it is up to you to ask. Solicitors are also required to tell you what percentage of your donation will be used for the charity and how much goes toward fundraising. Before you give, ask yourself if you really want to give money to a charity that spends more than 20 percent of your contribution to administrative costs.

Fraudulent solicitors can be very crafty. They may suggest that you have given to their charity in the past. They may play on your emotions. They may use a name that is close to a well-known, legitimate charity to confuse you. 

You must listen closely to what the person is saying and be alert for warning signs of fraud.  The FTS suggests consumers follow a few precautions to make sure their money goes to the causes they intend to support.

Always ask for written information, including the charity’s name, address and phone number.  Legitimate charities will give you materials outlining the charity’s mission, explaining how your donation will be used, and informing you whether your contribution is tax deductible.

Know the difference between ‘tax exempt’ and “tax deductible.” Tax exempt means the organization doesn’t have to pay taxes. Tax deductible means you can deduct your contribution on your federal income tax return. If deductibility is important to you, ask for a receipt showing the amount of your contribution and stating that it is tax deductible.

Refuse high pressure appeals. Legitimate fundraisers won’t push you to give on the spot.

Avoid cash gifts, which can be lost or stolen. For security and tax record purposes, pay by check. Use the full name of the charity on your check.

There are several resources available for checking on charities including the American Institute of Philanthropy, The Better Business Bureau Wise Giving Alliance, Charity Navigator, and Charity Choices.

For more information on making the most of your charitable giving check one of these resources or call the Madison County Cooperative Extension Service, 623-4072, and ask for the new publication “ Make Your Charitable Giving Count”.


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