'Tis the season to give gifts, but don't let your visions of doing good deeds cloud your ability to guard against being scammed, officials warn.
For weeks now, you've walked guiltily past the bell-swinging volunteers from the Salvation Army, or smiled and looked away from the representative of Toys for Tots.
OK, it's impossible to give to everyone. But when you're ready to make a holiday donation, to whom do you give?
"Watch out for appeals that are long on emotion but short on facts," warned Bennett Weiner, vice president and director of the Philanthropic Advisory Service, a department of the Council of Better Business Bureaus. The charity watchdog group annually reviews 300 of the most popular charities in the country, checking 23 points, from how they use their funds to ensuring that informational materials associated with the charity are not misleading.
"The vast majority [of charities] out there are indeed honest and ethical, however, the holiday season is a generous time for Americans and, unfortunately, unscrupulous operators are aware of that fact and will take advantage of that generosity," Weiner said.
Few laws regulate charity financing, Weiner said. The Supreme Court ruled in the 1980s that regulating how much a charity spends on fund-raising is unconstitutional and violates a charity's 1st Amendment rights.
The Philanthropic Advisory Service suggests that donors give to charities that spend at least 50% of their income on good works rather than administrative or fund-raising costs. Some charities hire professional fund-raisers, and a portion of the money collected goes to pay the fee, either as a flat rate or a percentage, officials said.
How charities spend their money can be learned by looking up the organization's Form 990, a document that must be filed with the Internal Revenue Service by all nonprofit organizations that take in more than $25,000 a year.
There are about 600,000 U.S. charities, with about 30,000 more established each year, Weiner said.
Also, all charities doing business in California, except religious groups, must register with the state attorney general's office.
Ask if the representatives collecting the money are volunteers or paid employees, advised Matt Ross, a spokesman for state Atty. Gen. Dan Lundgren. If you believe the fund-raiser is collecting too much, you should call the charities and donate directly to them, Ross said.
"Don't be afraid to ask questions, don't be pushed into doing something--you always have the option to say no," Ross said.
Authorities offer these tips to ensure you're giving wisely:
* Don't be pressured into an immediate donation.
"A charity that wants it today will welcome it tomorrow, next weekend or next month," Weiner said.
* When solicited over the telephone, ask for the charity's information in writing.
* Don't give your credit card number, bank account number or other personal information over the phone to someone you don't know. Instead, mail a check.
* Don't give cash; always make checks out to the organization, not to the solicitor or fund-raising company.
Donors should be aware that not every contribution is tax-deductible. If you buy something from a charity, such as a box of candy, only the amount above the fair market price of the item is deductible, Weiner said. For instance, if the charity is selling the candy for $10 but it normally sells in stores for $8, a donor can deduct only $2.
Donors may get information on a charity by contacting their local Better Business Bureau or checking the council's Web site at www.bbb.org