Charitable Giving Tips
Whether charitable organizations use their employees, volunteers or professional fund- raisers to solicit donations by phone, mail, or in person, consider the following precautions to ensure that your donation dollars benefit the people and programs you want to help.
-Ask for written information, including the charity's name, address, and telephone number. A legitimate charity or fund- raiser will give you materials outlining the charity's mission, how your donation will be used, and proof that your contribution is tax deductible.
-Ask for identification. Many states require paid fund-raisers to identify themselves as such and to name the charity for which they're soliciting. If the solicitor refuses, hang up and report it to local law enforcement officials.
-Call the charity. Find out if the organization is aware of the solicitation and has authorized the use of its name. If not, you may be dealing with a fraudulent solicitor.
-Watch out for similar sounding names. Some phony charities use names that closely resemble those of respected, legitimate organizations.
-Know the difference between "tax exempt" and "tax deductible." Tax exempt means the organization doesn't have to pay taxes. Tax deductible means you can deduct your contribution on your federal income tax return. Even though an organization is tax exempt, your contribution may not be tax deductible. If deductibility is important to you, ask for a receipt showing the amount of your contribution and stating that it is tax deductible.
-Know that a 501(c)(3) organization must make a copy of its annual returns, (Form 990 or Form 990EZ) for the last three years and its exempt status application and supporting documents available for you to view during business hours.
-Be skeptical if someone thanks you for a pledge you don't remember making. If you have any doubt whether you've made a pledge or previously contributed, check your records. Be on the alert for invoices claiming you've made a pledge when you know you haven't. Some unscrupulous solicitors use this approach to get your money.
-Ask how your donation will be distributed. How much will go to the program you want to support, and how much will cover the charity's administrative costs? If a professional fund-raiser is used, ask how much it will keep.
-Refuse high pressure appeals. Legitimate fund-raisers won't push you to give on the spot.
-Be wary of charities offering to send a courier to collect your donation immediately.
-Consider the costs. When buying merchandise or tickets for special events, or when receiving free goods in exchange for giving, remember that these items cost money and generally are paid for out of your contribution. Although this can be an effective fund-raising tool, less money may be available for the charity.
-Be wary of guaranteed sweepstakes winnings in exchange for a contribution. You never have to donate anything to be eligible to win.
-Avoid cash gifts that can be lost or stolen. For security and tax record purposes, it's best to pay by check. Use the official full name of the charity - not initials - on your check. Avoid solicitors who want to send a courier or use an overnight delivery service to pick up your donation.
When a Business Closes or Goes Bankrupt
It is quite distressing to a customer when a organization that owes them merchandise, service or a refund suddenly goes out of business. To avoid this predicament, your BBB offers the following advice:
*Avoid paying for any products or services in advance whenever possible. If it is required, make sure you have a written agreement with the organization that clearly spells out what they will do for you should they suddenly close or go bankrupt.
*Regarding rebates and warranties, make sure this same information is also found in those written agreements.
*Keep meticulous documentation of all transactions. Invoices, receipts, names of employees you worked with and other documentation are extremely important in recovering refunds or products from a closed business.
*Pay using a credit card. If you pay by cash or check and the organization closes, you will not likely be able to recover those funds. Under the Fair Credit Billing Act and certain credit card companies' rules, consumers whose merchandise was undelivered can usually get a refund on their credit card, (the process may take some time, however).
IF A COMPANY HAS CLOSED ITS DOORS AND/OR GONE BANKRUPT AND OWES YOU MONEY OR MERCHANDISE:
*Try to contact the organization directly first with a certified letter.
*If the certified letter goes unanswered and there is no way to contact the organization, you can file a dispute with your credit card organization if that was your method of payment. To be eligible under the Fair Credit Billing Act, you must file the dispute within 60 days of the transaction.
*If the organization goes bankrupt, you may be paid after the business liquidates its assets. To protect your rights in the bankruptcy proceeding, complete a Proof of Claim form and file it with the bankruptcy court.
*There is no guarantee that a customer will get money or merchandise owed in any situation. If you are owed a large amount of money, consider contacting a private attorney.
*You may also file a formal complaint against the organization with the Colorado Attorney General's Consumer Protection Division. Though the Office of the Attorney General cannot take legal action on behalf of individuals, action may be taken to enforce state law and in some actions can produce restitution for consumers.