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Charitable Contributions - the good, the great, and the ugly

January 23rd, 2006
the Social Diary Columnist & Photographer Margo Schwab

After being contacted by several charity supporters about their encounters and concerns, I decided to write the following as a public service note.

First, if you care about where your money actually goes, make sure the charity you support is a 501 (C) 3 organization. This means it has a tax ID number and is regulated by the State. This ensures that the proper amount of your ticket actually does indeed become a donation to the cause designated. Before you say so what, check. Not only is it nice to know the charity is legitimate, but also that you get your tax deduction.

Charity Navigator is a great resource for checking out the details of not only whether the organization is legal, but how much of the dollars collected are put to good use and not superfluous overhead.

Second, there has been a rising concern about full disclosure on auction items. There are great auction prizes out there. There are also the very few rare ones with interesting hidden details.

For example, a private jet to an exotic locale with 8 of your friends. Seemed great on the surface. Turns out the hotel is not a hotel anymore but a location for selling expensive ocean front vacation homes. It gets better. The salesperson for the venture was going to go on the plane with the prize winners. Paying to have a salesperson try to sell you on a vacation home for a long weekend?…. Would have been fine if the buyers of the prize had been disclosed this information at bidding time. But they weren't.

Other examples are overstated values for prizes. Again, legitimate sources provide legitimate auction prizes, and legitimate tax write offs.

Bottom line, be informed, be wise. If you buy a car, you investigate thoroughly first. You should do the same with charities and charities need to screen unknown auction donations with a tougher eye.

Charity Navigator

* Margo Schwab has produced, written, interviewed and photographed for various media organizations since 1989. Schwab has a Masters of Business degree from the University of San Diego. Schwab volunteers for numerous charity organizations. She also continues to lobby for water safety and for family violence mitigation. Schwab is the owner and publisher of the Social Diary.

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