Ways to find best nonprofits to give to for end-of-year donations

About $427 billion was given to charities in 2018, according to the National Philanthropic Trust. As the year comes to an end, many Americans might be looking to give to nonprofits.

There are about 1.5 million nonprofit organizations registered with the IRS, according to the National Center for Charitable Statistics. With so many to choose from, there are some simple ways to figure out which one to donate to and how to reap the benefits.

If you’re looking for an organization to donate to but don’t know where to start, your best bet might be to talk to friends, neighbors or colleagues.

“Ask them what their experience has been as a donor to that organization,” said Jamie Schloegel, executive director for the La Crosse Community Foundation.

Then check out the charity’s social media or website. Schloegel recommends potential donors look to see if there’s a 990 Form from the IRS or an audit report.

“That’s generally a good sign that it’s a very well-run organization that can be accountable with charitable gifts,” Schloegel said.

Claims about how much it spends for every dollar it receives can be misleading, making you think it’s spending a lot or not enough on its services, for example, if a group claims for every dollar it receives, it spends the entire dollar on services. But nonprofits have overhead expenses, especially if they have paid staff.

“It takes time and resources and qualified competent staff for them to deliver on their mission,” Schloegel said.

Before you donate, make sure it is a qualified charitable organization, like a 501 (c) 3.

“Any gifts to organizations that don’t fall under that Treasury regulation are not considered charitable gifts,” Schloegel said.

That means you won’t get the benefit come tax time. While it all depends on the situation, you might find you won’t be able to get a deduction.

“The new tax law makes it a little more difficult for you to be able to deduct the contribution,” said Mike Klauke, a financial advisor.

Klauke recommends you meet with a tax preparer to create a giving plan for the year. That way, you can get above the standard limit.

“And then they will count. So the key is to have a plan,” Klauke said.

There are some other ways to give money, like giving appreciated stock to a charity.

“You get the full write-off but you don’t have to pay the capital gains on it,” Klauke said.

No matter what you do, Klauke said you will need to have the donation on the way to the charity by the end of the year in order to make it count, both for them and for you. If you are looking to get the tax writeoff, make sure that you get a letter from the organization that you’re giving to. It should have the amount that you gave so you can prove it is a charitable contribution.

If you’re still unsure on who to give to, certain groups like the La Crosse Community Foundation can help. They work with potential donors to set up charitable funds and do their own due diligence to make sure area nonprofits are worthy recipients.

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