The demand for charitable services is always in high demand and you want to do your part. But how can you know whether the money you donate is actually used for the cause you want to support? Verify the charity before you give.
It’s all in the form - The IRS requires charities to make their three most recently filed annual Forms 990 (Return of Organization Exempt from Income Tax) available for public inspection. Form 990 details a charity’s accomplishments and discloses information about fundraising, compensation and governance. You can use the forms to evaluate how your potential choices are using their money and compare different organizations.
How can you get a copy of a charity’s Form 990? GuideStar (www.guidestar.org) and the Economic Research Institute (www.eri-nonprofit-salaries.com) provide free access to charities’ Forms 990 and other data. You can also check the charity’s website or request a copy from the organization or from the IRS. Charities and the IRS may charge a fee to cover photocopying and mailing.
For more say over your money - You might want to look at nonprofit organizations that allow potential donors to choose the specific projects they want to fund. Donors review a list of projects on an organization’s website and choose the one they want to fund. Support can be for an entire project or a portion of it.
To give more - Once you’ve chosen an organization to support, here’s one idea for making a significant donation. If you have a life insurance policy on your life that you no longer need, consider giving the policy to the charity or naming the charity as the beneficiary or contingent beneficiary, in case your family’s circumstances change in the future. When it comes to charitable giving, be sure to consult your legal and financial professionals for guidance.
