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BBB Offers Giving Tips for Newtown Tragedy

By Steve Abel – President-BBB | January 1, 2013

In the wake of the shooting at Sandy Hook Elementary Schoolin Newtown, Connecticut, the BBB Wise Giving Alliance, the national charitymonitoring arm of the Better Business Bureau, cautions donors about potentialred flags in fund raising to help Newtown and to be aware of the differentcircumstances that often emerge in tragedy-related philanthropy. Certainly this tragedy will inspire people to give.Americans are emotionally drawn and will respond to requests to help the SandyHook community, advocacy groups and mental health charities among others, andwhile they should be on the lookout for questionable solicitors and scammers,people may be less clear about the complicated legal character of their gifts.The BBB Wise Giving Alliance offers these tips to educate donors, avoid problemappeals, and give with confidence regarding this tragedy or giving to anycharity. {{more}} Thoughtful Giving – Takethe time to check out the charity to avoid wasting your generosity by donatingto a questionable or poorly managed effort. The first request for a donationmay not be the best choice. Be proactive and find trusted charities that areproviding assistance. Respecting Victimsand Their Families – Organizations raising funds should get permission fromthe families to use either the names of the victims and/or any photographs ofthem. Some charities raising funds for the Colorado movie theater victims didnot do this and were the subject of criticism from victims’ families. How Will Donations BeUsed? – Watch out for vague appeals that don’t identify the intended use offunds. For example, how will the donations help victims’ families? Also, unlesstold otherwise, donors will assume that funds collected quickly in the wake ofa tragedy will be spent just as quickly. See if the appeal identifies when thecollected funds will be used. What if a Family SetsUp Its Own Assistance Fund? – Some families may decide to set up their ownassistance funds. Be mindful that such funds may not be set up as charities.Also, make sure that collected monies are received and administered by a thirdparty such as a bank, CPA or lawyer. This will help provide oversight andensure the collected funds are used appropriately AdvocacyOrganizations – Tragedies that involve violent acts with firearms can alsogenerate requests from a variety of advocacy organizations that address gun use.Donors can support these efforts as well but note that some of these advocacygroups are not tax exempt as charities. Also, watch out for newly createdadvocacy groups that will be difficult to check out. Online Cautions – Neverclick on links to charities on unfamiliar websites or in texts or emails. Thesemay take you to a lookalike website where you will be asked to provide personalfinancial information or to click on something that downloads harmful malwareinto your computer. Don’t assume that charity recommendations on Facebook,blogs or other social media have already been vetted. FinancialTransparency – After funds are raised for a tragedy, it is even moreimportant for organizations to provide an accounting of how funds were spent.Transparent organizations will post this information on their websites so thatanyone can find out and not have to wait until the audited financial statementsare available sometime in the future. Newly Created orEstablished Organizations – This is a personal giving choice, but anestablished charity will more likely have the experience to quickly address thecircumstances and have a track record that can be evaluated. A newly formedorganization may be well-meaning but will be difficult to check out and may notbe well managed. Tax Deductibility – Notall organizations collecting funds to assist this tragedy are tax exempt ascharities under section 501 of the Internal Revenue Code. Donors cansupport these other entities but keep this in mind if they want to take adeduction for federal income tax purposes. In addition, contributions that aredonor-restricted to help a specific individual/family are not deductible ascharitable donations, even if the recipient organization is a charity.

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