When the holiday season comes around, Christine Blaine gathers up shoe boxes to send to Operation Christmas Child, a national program that sends boxes of gifts and necessities to children worldwide at Christmastime.
“I like it because I can get my daughter involved and help her to understand that not everyone is as blessed as she is,” Blaine says.
The holiday season is a prime time for charitable organizations to get recognized and raise funds. For some nonprofits, the last three months of the year fund the entire organization, says Lindsay Nichols, a spokeswoman for GuideStar.org, a Williamsburg, Va.-based source of national nonprofit information.
But many charities are still struggling. Giving has declined by 10 percent since 2005, after adjusting for inflation, according to a report by the National Center for Charitable Statistics. And although donations increased slightly from 2010 to 2011, there is a lot of ground to make up.
As the season of giving begins, Nichols gives five steps to consider before choosing a charity.
1. Clarify your values
There are more than 2 million nonprofit organizations nationwide, Nichols says. And the best way to give is proactively, not reactively.
“Take a few minutes and really think about what you want to support,” she says. “Do you want to support local, national or international charities? Do you want to support animals or education?”
A nonprofit’s mission statement should be clear, and it should speak to you.
“The mission statement will help you figure out which of the 10 charities that are, for example, saving an acre of land, that you want to support,” Nichols says.
If you cannot find a mission statement — on the organization’s website or at nonprofit information website like guidestar.org — that is a clear red flag.
2. Verify legitimacy
In 2006, nonprofits became legally bound to file an IRS Form 990 for three consecutive years to maintain their tax-exempt status.
Last year the IRS released the first list of noncompliant charities. More than 275,000 organizations lost their tax-exempt status, Nichols says.
“The rules are a bit different for faith-based organizations, but you should be able to verify their status by requesting some documentation,” she says.
The websites guidestar.org and charitynavigator.org also track IRS documentation and independently verify compliance.
3. Do a little research
After finding a clear mission statement, look for information on programs that detail how the mission statement is achieved.
“The programs should tell you how that one acre of land is going to be saved,” Nichols says.
It is also a good sign when nonprofits present specific, measurable goals and concrete criteria for describing successes.
The annual report, which often can be found on the organization’s website, and any stakeholder reviews will give you a good idea of how the nonprofit works and how successful it is.
“The stakeholder reviews are great, and they are real-time,” Nichols says. “When the Susan G. Komen Foundation dropped its funding for Planned Parenthood, its review ratings dropped from five stars to two. It was a real-time reflection of what people were thinking about the organization.”
4. Trust your instincts
If you ever feel pressured to give, that is a red flag.
“It’s really a problem if you have said ‘no’ and the nonprofit keeps asking,” Nichols says. “The bottom line is, if you’re still having doubts about the organization, don’t give.”
5. Holiday programs
Some retailers have announced their holiday charitable programs for the year.
Toys ‘R’ Us, for example, will donate $200 in toys to Toys for Tots for every person who pays off a layaway account for someone in their community.
The idea is a take on last year’s grassroots phenomenon that saw hundreds of layaway accounts, mostly focusing on toys, being anonymously paid off just a few days before Christmas. The givers were dubbed “layaway angels” by the media.