TWIN FALLS — So you want to give to a nonprofit this holiday season. But there’s so much to consider when trying to pick the right one, where do you even begin?
Does the charity have tax-exempt status? How much money is spent on programs versus salaries? What services are offered to those in need?
It can be overwhelming.
According to Brett DeLange, chief of the Consumer Protection Division for the Idaho Attorney General’s Office, donating to a charity is not much different from shopping around before purchasing an appliance or a car.
Idaho law prohibits misleading or false charitable solicitations, but he said he’s seen his fair share.
“Typically what we try to tell people is when you donate to a charity, it’s more important than ever to vet where you’re sending your money,” said Veronica Craker, a spokeswoman for Better Business Bureau Northwest in Boise.
These warnings may sound intimidating, but DeLange said he still wants to encourage people to donate to nonprofits.
“Know who you want to donate to and send it to them directly,” DeLange said.
Whether you plan to give online, in person or by mail this holiday season, here are five things to consider before locking in that donation:
How much is used for programs?
The BBB recommends no more than 35 percent of a nonprofit’s contributions should go toward fundraising. At least 65 percent of expenses should be for programs — providing a service to those in need.
“We don’t have anything set on how much they should be paying an executive director,” Craker said. “We just want to make sure the majority of the funds are going into the organization — not paying the overhead.”
Be wary of phone and online solicitations
DeLange advises being wary of making a donation over the phone.
“If they’re calling you on the phone, they’re a professional fund raiser,” he said.
The fund raiser could get 80 percent of your donation before it even goes to the charity, DeLange said. That means if you donate $100, there’s a possibility only $20 will go to the organization.
There are many charities in the Magic Valley and Idaho operating on a shoestring budget that are doing great work, DeLange said. The few programs that don’t do what they indicate, however, sully the ones that do.
“They lose out when professional fund raisers call you and the money is siphoned off,” DeLange said.
Also, it’s easy for someone to claim they’re from a charity when they’re actually not.
“You just don’t know who’s on the phone,” DeLange said.
A more recent trend in charity work is online crowdfunding. Some websites vet the causes to make sure they’re legitimate and delete pages that don’t meet their standards, but not always.
Craker recommends knowing the person or organization behind the crowdfunding page before donating.
Do your homework
“It’s important to do your homework with who you want to donate (to),” DeLange said. “You can’t judge a charity by its name.”
Donate directly to organizations you know, he said, and also the ones in which you have confidence in their work and mission.
For local nonprofits, word-of-mouth is a great way to help with the vetting process.
One source of information is the Better Business Bureau’s give.org. BBB provides accreditation for charities. It doesn’t cost a nonprofit anything to go through the process, but it’s rigorous, and they must meet 20 standards.
Beyond just finances, BBB covers topics such as board of directors oversight, conflicts of interest and effectiveness of the nonprofit — whether they’re able to do what they’re promising.
Another good source of information is Guidestar.org. You can look up a few years’ worth of a nonprofit’s Form 990, which is filed with the Internal Revenue Service. It outlines information such as revenue, expenses, salaries and how donation money is being used.
Does it have tax-exempt status?
The BBB encourages charities to gain tax-exempt status as a 501(c)(3), but not all of them do.
“That is something you should look for,” Craker said. “That’s one good way to see if that’s a good charity to donate to.”
One easy way to check is to put the organization’s name into the IRS’ online charity database.
What is the charity asking for?
If you’re donating to a charity that’s asking for items such as clothing or food — especially, after a natural disaster — be cautious, Craker said. It’s hard to guarantee items will reach their final destination in a timely manner.
Instead, Craker said, “find a charity that’s already on the ground doing things and donate funds that way.”