When finances are tight, it can be hard to designate some cash to give away. But even the Grinch-iest and Scrooge-iest among us can be moved to donate during the holiday season. In fact, the Tuesday after Black Friday was recently called “Giving Tuesday” to get everyone in the spirit.
Whether you plan to toss some change in a bell ringer’s kettle or donate a sizable percentage of your income this holiday season, be smart about your charitable donations. Before your Grinch heart grows three sizes and you’re ready to carve into the roast beast, do your research: What does a charity need most? Which charity should you choose?
We’ve got you covered. Consider the following when you’re ready to dig into your most generous pocket:
1. Pick a charity you’ll feel dedicated to. To avoid feeling overwhelmed by choices, make your gift personal. Maybe you have something to feel especially thankful for this year — your health, a new baby, or a promotion at work. If you can tie your donation to a personal experience or memory, it narrows your options and can make you feel more connected to your gift. Alternately, consider local organizations: you may see the effects of your donation more directly.
2. Try to write a check. It can be tempting to make your donation through a social media site, by text, or in another novel way. But those tools cost the charity — and that money is taken away from its core mission. Even donating by credit card costs the organization, so the most efficient way to donate is to simply write a check.
3. Make sure taxes are in order. Most donations to a qualifying nonprofit are fully tax deductible. There is an exception, however, if you receive goods or services in exchange for your gift. For this reason, in the event of an IRS audit, your bank account or credit card statement showing the donation isn’t enough to prove the donation — you’ll need a written receipt from the charity showing your donation amount and stating that you did not receive anything in exchange.
4. Ask an organization what it needs most. This seems obvious, but not every organization needs canned goods or the clothes you just cleaned out of your daughter’s closet. In fact, it might create more work and inefficiency for the organization if you drop those items off. In many cases, they would probably prefer a monetary donation. In others, maybe they’re short-handed and could really use your time. If that’s what they say, listen! And hey, volunteering could be a heart-warming (and free!) family holiday activity.
Try out these simple steps before signing away the big bucks this holiday season. You don’t want to ruin the lovely feeling of giving by having a Scrooge reaction to spam or taxes.
Do you have a favorite charity that handles donations especially well? What do they do right?