Giving Tuesday: How to avoid fraud and ensure your donations have a big impact

Ahead of Giving Tuesday, the Dayton Foundation has some tips to help you donate to verified local organizations, find tax benefits, and increase the impact of your giving this holiday season.

Jerry Kenney I spoke about this with Michelle Lovely, the foundation’s senior vice president for development and donor services.

This interview was conducted for clarity and length.

Michelle Lovely: Giving Tuesday is a great way for people to come together and give. So it’s a day that’s really about giving back to the community, giving back in a consolidated way to the nonprofits that you care about, and if we look at the tips for easy giving in general, that’s one of the things we always talk about It’s about the fact that it’s always good when we pull together and achieve a greater impact together. So I think Giving Tuesday has something to do with steroids. It’s really about coming together as a large group and helping the nonprofit organizations financially through your donation.

Jerry Kenney: And you also sent out a few recommendations for people who would like to donate at this time of year. The first thing you mentioned is to do your research. Can you explain what you mean by that?

Nice: So when we say do your research, what we really mean is that you always want to check their website to see what the nonprofit needs and sometimes even call and talk to them. A financial donation is always great, especially if it is unrestricted. Nonprofit organizations can use these types of funds at any time. But sometimes people donate something they think the nonprofit needs. But then maybe they’re donating clothes, but they really need food. So just contact this nonprofit to find out what their needs are. Then check candid.org is a great place to check if you want to find out about their financial stability. You can click on the tax return for the company. And then we always just say, “Don’t rush.” Because this time of year is where scams tend to happen, and people are generous toward the end of the year and during the holiday season. And so if you ever feel too pressured to make a donation right away, I always say, take a step back. Say, “You know, can you give me your information, your website information, I’ll take a look at it and consider donating.” Again, don’t rush it, get to work and make sure that you donate to a legitimate charity.

Kenney: This is something your foundation does every day.

Nice: Yes, the Dayton Foundation is happy to help you. If you want to get in touch to find out, “Hey, who and what are the organizations that are really feeding the hungry right now?” Or whatever their passion is, who are the organizations that are making a difference in this sector? So we like to share some things, the projects we’re seeing or nonprofits that have applied for funding. We are always happy to share this information with anyone who may be interested. And (for) our donors, one of the benefits of having a fund at the Dayton Foundation is that we actually vet the charities. So we go out and do that research to make sure they’re still in good standing with the IRS and eligible for a grant. Many people use our free charitable checking account just to make sure their donation goes to a legitimate 501-C3 account.

And we have over 4,000 funds, but if you have a fund here, you can donate (wherever you want). Maybe you have a grandchild who lives in California and you support them on a walk or run. And then maybe donate to the local animal shelter here in Dayton. So you can literally grant anywhere you want. It is not limited to things that are not our priority. It is your priority as a donor. What charities are important to you? So there are no restrictions.

Kenney: Of course, a plus for donors who give at this time of year are tax deductions. What can you tell us about how this is developing?

Nice: I always say, the best advice I can give is: If you’re thinking about donating, just stop. And before you pull out your checkbook or write a check, before you pull out your credit card, maybe talk to your accountant or financial advisor, your planner, the Dayton Foundation, someone. Just say, “Is there a way to make this more tax effective?” When we meet with a donor over the age of 70, we often ask ourselves, just to give a few examples, “Do you have a traditional IRA?” Because the important reason is a traditional IRA: If you make a qualified charitable distribution to a 501-C3 or through a Dayton Foundation fund, one of our IRA funds, you may be subject to state and federal taxes on that qualified distribution Completely avoid charitable distributions up to $105,000 per person. So that’s one thing.

And then a few other examples that we always talk about this time of year. Many people may not be able to provide more information, but they have an estimated inventory. So there could still be a tax problem for them if they hold on to a stock that they couldn’t sell because it appreciated a lot in value. It’s a great way for your financial advisor to get this asset out of their portfolio. You can then rebalance that, get rid of the appreciated inventory and use it for charity.