Charities use a wide variety of methods to solicit charitable donations. Many legitimate charities are able to use email, social media, and Internet fundraising pages to lower costs and access donors. However, these technologies also make it easier for fraudsters to pose as legitimate charities and exploit the generosity of donors. To make sure you are donating to a legitimate charity:
- Never give on impulse. Never give in to high-pressure requests for contributions or donations. Legitimate charities will not pressure you for an immediate donation and are happy to provide information about their charity for you to review and share with neighbors, friends and family.
- Do your research. Always obtain written information (including annual reports) about the charity before you donate. Always make sure you know how your donation is distributed. Always know how much of your donation will actually go to the charity itself (versus administrative costs).
- Know who is asking. Always ask the fundraiser if they are a volunteer or a paid fundraiser. Always ask for information in writing of how much the fundraiser will keep of the donations collected and how much will actually go to the charity. Be wary of words like "majority, large, most of, large percent, administrative costs, processing fees, handling, etc."
- Avoid paying cash. Pay charities by credit card payment or by check that is payable to the fund, not to an individual, and donate directly to the organization either in person (at an event sponsored by the charity) or through the United States Postal Service. Never give a donation to a charity that (a) offers to take your donation directly from your account, such as an automatic debit; (b) encourages you to send a donation by courier/overnight express; or (c) asks you to wire your donation.
- Avoid copycats. Watch out for charities with names that sound similar to well-known organizations or charities. Sometimes these sound-alike names are simply intended to confuse donors. Also be cautious of “look-alike” websites. These fraudulent websites will often ask for personal financial information or may download harmful malware into your computer.
- Check with the charity. If you receive an email or text message asking for a donation, confirm that the request is from the charity, and not an imposter, by contacting the charity or visiting its website. Likewise, don’t assume that charity recommendations on Facebook, blogs, or other social media have already been vetted. Research the charity yourself.
- Keep personal information private. Never give out personal information, such as your birth date, social security number, credit card number, checking account number or any financial information to a solicitor either by telephone, mail or door-to-door.
- Know the difference between "tax deductible" and "tax exempt." Tax deductible means you can deduct your donation on your federal income tax return. Tax exempt means the charity does not have to pay taxes. Even if a charity is tax exempt, your donation may not be tax deductible. If you would like a tax deduction, ask the charity for a receipt showing the amount of the contribution and stating that your donation is tax deductible. For more tax information regarding charitable contributions visit http://www.irs.gov/Charities-&-Non-Profits/Contributors.
Use the following links to learn more about charities and fundraising, or to research a charity online:
Federal Trade Commission at: www.ftc.gov/charityfraud or www.consumer.ftc.gov/articles/0074-giving-charity
Better Business Bureau at: https://www.bbb.org/us/az/phoenix/category/charity-local/accredited