Tips on Giving to Charities During the Holidays

During the holiday season people are more charitable than at any other time of the year. Most know that it is good to be charitable, but to whom? The questions people usually ask are: Is this organization I've heard from legitimate? Or, if I give, how much money is actually going to go to charitable works?

Answering these questions is never easy to answer or straight forward. Each individual must decide whom to help (poor families? sick children? homeless animals?) and what charitable organization can do the most good with the dollar.

Experts who study charities, urge donors to find out as much as they can about a charity that might get their money.

Here are a few questions people should ask:

Who are you dealing with?

Be sure you know what the organization is trying to do. Find out how much of the money is actually going to be used for the purpose for which the organization exists.

How do you do this? Ask the organization questions. Get an annual report. Check on the agency's reputation with the state attorney general's office and the Better Business Bureau. Going to BBB.org or Liveuntited.org also can give information on its member agencies.

For details on finances, look at the proper tax forms that most nonprofit organizations must file with the Internal Revenue Service. Churches and local chapters of some national organizations do not have to file.

Agencies are required to make the forms available for inspection. It gives an overview of income, expenses and salaries.

It also shows how much money goes for programs, management and fund-raising. Salaries are broken down according to how much time and work the employees devote to each of the three categories.

Assignment of expenses to the categories can be somewhat subjective, depending on who is filling out the form.

Anyone thinking about making a sizable donation to an agency should visit it, talk with the executive director, see what the organization is really doing, and ask to see an audited financial statement.

Some other good ways of finding out if a charity is worth donating to is the Council of Better Business Bureaus which publishes standards and evaluates national charities.