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It’s the time of year again when the spirit of giving takes hold and collection efforts across the country increase to capture donor dollars.  Direct mail campaigns, phone calls, and posts to social networks are a sampling of the many ways legitimate charities (and other) try to get your attention.  Making charitable donations is a good thing.  In many cases, charitable donations can also be a smart move before tax time.  Legitimate charities can be massive international conglomerates or small operations run from home.  Each day, these organizations utilize donor dollars for good.  Don’t let a few bad apples spoil the bunch.  For both planned donations and those made on-the-spot, this guide can help ensure donations make it to the right place.

Planning a Donation

Planning donations ahead of time is great for annual budgeting and for avoiding overspending.  For the larger and more-popular charities, the planning process can be fairly simple.  Most of these charities wear legitimacy on their sleeve.  Addresses, Director names, tax documents and more can all be found through charity websites or at local offices.  For smaller or newer organizations, you may have to dig a little deeper.

  • Online Searching. Before donating, check online for information about the organization. Most charities maintain websites with organizational details such as a physical address, mission statement, and other documentation.  A web search can also return negative press for singling-out scammers or poorly-run organizations.  Smaller, local charities may have a limited online presence, if any.  For these, a quick check of IRS records will help verify legitimacy.
  • Online Databases. The IRS maintains a database here listing charities registered in the United States. This tool helps inform whether donations are going to be tax-deductible.  Churches are unlisted but in most cases, donations made to a religious organization will also be exempt.  Other tools for vetting charities are Charity Navigator, Charity Watch, GuideStar, and the BBB Wise Giving accreditation list.

On-the-Spot Giving

More than just during the holidays, opportunities for on-the-spot giving exist year-round.  In the mail, on the phone, and in-person requests for donations happen daily.  Many of these charities are legitimate, serving year-round causes, yet some are less-deserving.  Before making an on-the-spot donation, perform this quick check to help verify legitimacy:

Is the charity a response to a recent disaster?

Too often, stories emerge of people taking advantage of a crisis.  If this is a new charity or donation drive based on a recent disaster, explore further.

Is the charity familiar?

Many charities have become household names, or are at least locally-recognizable.  Other times, scammers adopt charity names with names very similar to legitimate ones to confuse donors.  Avoid scammer charities.  Uncover more information on charities with names you don’t recognize.

Does the charity exist online?

With mobile phones, a web search on the go is often quite possible.  Before mailing, texting, or handing over any money, check the web for info.  A website, consumer news, and other online mentions may help in deciding.

What is the donation method?

These days, payment method matters.  Protecting financial data is an active concern.  Be wary making donations over the phone or sending credit card data through the mail.  Cash donations should only be made in-person and you should always collect a receipt.  Exercise vigilance making donations online, and use secure payment methods.

Who is collecting the donation?

There is no guarantee the person on the other end of the line works for the charity they claim to represent.  Other times, third-party companies market on behalf of charities, sending small gifts through the mail in exchange for later donations.  When making payments on the phone, in person, through the mail or online check to see who is collecting the donation.  When possible, deal with charities directly.

Where is the donation going?

A percentage of each donation pays for daily operating expenses, collection effort, and so forth.  How large of a percentage will change with each organization.  Some charities have become infamous for funneling incredibly low percentages of donations to their intended recipients.  On the other side, any organization claiming to donate 100% of collected funds must get funding from somewhere.  Investigate further.

Most likely, an investigation will reveal a legitimate charity trying to do some good.  These questions are meant for helping make educated donation decisions and avoiding placing donations where they don’t belong.  Always get receipts for donations and at the end of the day: trust your gut.


Donate and Receive

Donations have rewards you can take to the bank.  Call Overland & Shanahan today to see how donating to a legitimate charity can help you this tax season.  Speak to one of our Wealth Advisors to see how donating can help unlock tax incentives for personal and business tax filing.  For more information on taxes and other finance topics, visit


The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. This information is not intended to be a substitute for specific individualized tax advice. We suggest that you discuss your specific tax issues with a qualified tax advisor.