Below are some common questions that we thought you might have
about being an educated Donor. If you do not see
your question in the list below, or would like further assistance regarding a
question, please feel free to Contact Us.
If you are looking for CommunityRoom.net specific questions, please
refer to our Community Room FAQs page.
How do I know where my donation dollars are
going to? How are they being used?
Ask how much of your donation goes for general administration and fundraising
expenses and how much is left for the program services you want to support.
American Institute on Philanthropy's Charity Rating Guide recommends that in
most cases 60% or more of your charitable donation should go to program
services. Less than 40% should be spent on general administration and
fundraising costs. Keep in mind that newer groups and those that are working on
less popular issues may find it necessary to spend a greater percentage on
fundraising and administrative costs than well-established, popular groups.
Can I use my donation as a tax deduction?
Not all charities soliciting for "good causes" are
eligible to receive tax-deductible contributions. "Tax exempt" means the
organization does not have to pay taxes. "Tax deductible" means the donor can
deduct contributions to the charity on his or her federal income tax return.
Request the charity's tax exempt letter. If the charity does not have a tax
exempt letter indicating its status with the IRS, you cannot legitimately claim
your contribution as a tax deduction. Even if a donation is deductible, there
can be limitations on the charitable deduction that reduce or eliminate any tax
benefit. Always consult your tax advisor before making a substantial
charitable gift.
I frequently receive donation solicitations by
phone, how do I know they are legit?
Although many legitimate nonprofits are turning to phone solicitations, it is
incumbent upon you the donor to make the decision whether or not to make a
donation. A sound piece of advice is not to give your credit card number
to a telephone solicitor you do not know. Give your gift by check or money
order so you will have a record for tax purposes. Also some questionable
charities use an impressive name which closely resembles the name of a
respected, legitimate organization. Ask for information in writing. In the end,
if you do not feel comfortable making the donation to a questionable nonprofit,
don't do it.
Won't a charity give me all the information
about making an informed decision?
Charities have an obligation to provide detailed information to interested
donors. Never give to a charity you know nothing about. Request written
literature and a copy of the charity's latest annual report. This should
include a list of the board of directors, a mission statement and the most
recent available audited financial statements with accompanying notes. If a
charity does not provide you with the information you request, you may want to
think twice about giving to it. Honest charities typically encourage your
interest and respond to your questions.
If I do not want to give money, can I
volunteer my services instead?
That depends on the nature of the mission of the nonprofit. Typically the answer
is "YES!". The best course of action would be to contact the
nonprofit directly for more information on volunteering.
A charity has solicited me for a donation and
wants to give me a gift in return for a monetary donation. This doesn't seem
legitimate. Is it?
Direct mail solicitations are often accompDirect mail solicitations are often accompanied by greeting cards, address
stickers, calendars, key rings or other "gifts." Charities do this because it
can increase donations. But do not feel that you have to make a contribution to
keep these "gifts." It is against the law for a charity to demand payment for
any unordered merchandise. Be aware that these enclosed items can mean higher
fundraising costs for the organization.
