By Alex Cohen
GIVE. It sounds so simple, right? On the surface, it is. Giving effectively and strategically, on the other hand, well, that’s a little trickier. We’re here to help you GIVE smart and make sure that your donation is being used to help those who need it the most. Even something as simple as a quick online search can give you some level of comfort in knowing that your charitable dollars are going to the cause you desire.
The first thing you should check is whether the organization is a 501(c)(3), which means that it is recognized as a charitable organization by the IRS. Verifying a group’s 501(c)(3) status is extremely important because there are some sites that host “fundraisers” and accept “donations” for groups that are not actual charitable organizations. This means that the organization does not have to publicly report its spending, and your contribution will most likely not be tax deductible.
The easiest way to determine if an organization is a 501(c)(3) is get their Employer Identification Number (EIN) via their website or calling the group directly. Once you have an EIN, you can check its validity on the IRS Charitable Organization Search . This is a free service site that provides resources about tax information for charitable organizations, and even includes a Web-based Mini Course on charitable contributions.
This is the first step of your research or due diligence process, but you may want to go a bit further and see how the organization is evaluated by an independent organization. One such organization is Charity Navigator, another free site that evaluates US charities and reports on their financial performance, accountability and transparency – all things that allow you, the donor, to make an informed giving decision.
We hope this first step can help you to GIVE smart!
Happy Holiday Season!