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Give charitable giving some thought this year

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The season is fast approaching when the weather cools off and nonprofit fund raising heats up.

For tax reasons, many people try to make their charitable gifts before the end of the year, and many organizations get most of their contributions for the year during

autumn and the holiday season. With so many good causes needing support, how do you choose?

Here are my top 10 tips for smart giving to nonprofits:

1. Decide how much you can give. People who give a true tithe are in the minority, but over 70% of Americans make charitable contributions each year, averaging 2%

of pre-tax income. Mississippians tend to give more.

INDEPENDENT SECTOR has long promoted a “Give Five” campaign for 5% giving and five hours a week of volunteering. Whatever you do, it helps to plan and

build it into your regular budget.

2. Gather information about charities. Keep a file of mailings you receive, or better yet, do some research yourself. There are many sources for information on

Mississippi charities, including a free Report on Charitable Organizations from the Secretary of State’s Office. The 2000 edition has just been released; call (601)

359-1633 or 888-236-6167.

Guidestar is a good on-line resource at www.guidestar.com. Check to see if an organization is a member of the Mississippi Center for Nonprofits at

www.msnonprofits.org.

Large national organizations may be evaluated by watchdog groups such as the National Charities Information Bureau (www.ncib.org). You can also request

information directly from charities; legitimate organizations will not object. You have a legal right to see financial information in the Form 990 from every organization

that files one.

3. Think about your priorities. What do you care about? What does Mississippi need? Where can you make a difference?

4. Evaluate organizations. Consider both well-known charities and less obvious choices. Either way, be sure organizations are legitimate and are doing what they claim

to do. All organizations raising funds in Mississippi (except churches) should be listed as either registered or exempt in the Secretary of State report. Financial

information in the report can be useful, but avoid using program, fund raising and administration cost percentages as a ranking tool without more information. High

program percentages may just reflect bad accounting, and they don’t show whether the programs are effective.

Other expenses are not necessarily bad – an organization could hold down administrative costs by not auditing financial statements, not holding board meetings and

not supervising employees, but is that what we want? What counts is how much an organization is accomplishing for the total cost, and whether it is worthwhile.

5. Don’t be pressured. Impulse giving is not always bad, but you have the right to say no to any solicitation. I know there are good charities that use mass telephone

solicitation, but I don’t like it and don’t respond to it myself.

6. Make a meaningful contribution. Charities welcome all contributions, but a one-time $10 gift may result in more expense in future mailings than what you gave. Give

mainly to organizations you think you may want to give to again, and give enough to make a difference.

7. Use restrictions sparingly. You can restrict gifts to a specific purpose, which is sometimes useful, but too many different restrictions can be an accounting nightmare

for nonprofits. If an organization is using its resources well, an unrestricted contribution will usually do the most good.

8. Keep receipts and know how much is deductible. With few exceptions, only contributions to 501(c)(3) nonprofit organizations are tax-deductible. Be sure you

receive the receipts you need for contributions of $250 or more. If you get something in exchange for the contribution, the full amount may not be deductible.

9. Consider other ways to give. Gifts of time, services or tangible goods can be as valuable as money. If you don’t have a will-and 70% of Americans die without

one – you can do your family and the charities you support a favor by writing one now. A bequest or planned gift can leave a lasting impact. So can a new foundation

or community foundation fund. Mississippi leads in individual annual giving, but it still trails in foundations and endowments for the future.

10. Stay informed and update your giving. Keep in touch with the organizations you support, and evaluate your giving patterns annually. There are many good choices,

including new ones that emerge each year.

Nathan Woodliff-Stanley is executive director of the Mississippi Center for Nonprofits in Jackson. His column appears regularly in the Mississippi Business Journal.

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