We've brought you warnings about other scams. This is not so much about a "scam," but rather a caution to be careful about which charities you support, when you give generously to organizations you believe will use those funds to aid service members, veterans and their families.
We're bringing you this information to help you ensure that your hard-earned dollars are actually going to the causes you want to support.
Some veterans charities are shortchanging the nation's veterans, actually funneling little of the money they collect to their "charitable purposes." Some of the causes for this include ineptitude at fund raising, paying high fund raising costs to third parties, and paying high salaries and benefits to the organizations officers.
The use of tax-exempt organizations to solicit donations is an area that unfortunately has been inundated with fraud in recent years, particularly the establishment of new "charities" since the 9/11 tragedy. Many unscrupulous individuals are "cashing in" on America's generosity to help those in need in order to line their own pockets.
In order to qualify as a tax-exempt charitable organization under IRS Code Section 501(c), an organization need contribute a mere 5% of the fair market value of its assets to its designated charitable cause. Obviously, if its assets consist of cash solicited from donors, that means it would have to donate only 5% of the cash it collected in order to maintain its tax-exempt status.
Obviously, there are many fine charities out there, organized and operated efficiently, and using a much larger percentage of their revenues for their stated charitable purposes. And we don't want the recent media reports of abuse to hurt the fund raising efforts of the legitimate charities who do a wonderful job of providing assistance when and where it's needed.
So it is very important for you to do your research before you select a charity to receive your hard-earned dollars. After all, you want to make sure your money supports the causes you want to support, and doesn't go to pay some third-party fund raising expenses, or buy a new vacation home for the charity's CEO.
Take a look at this recent ABC news report for a better understanding of the problem.
The Washington Post published a recent expose of various veterans' charities that are falling far short of expectations. There were some surprising names in the report they reference, by charity watchdog organization American Institute of Philanthropy.
We're happy to report that our two favorite charitable organizations supporting military families, whose logos you will find on the right side of each of our pages as a link to their web sites, both scored very high.
Fisher House Foundation provides low- or no-cost housing to military families in "comfort homes" located on the grounds of military and VA hospitals, so that family members can be close by to offer support and encouragement as their loved ones undergo treatment in those facilities.
Fisher House Foundation scored an A+, using 92% of its budget for program services, and spending only $2 to raise $100. We encourage you to read the story about the inspiration for and creation of Fisher House.
The National Military Family Association (NMFA) was organized in 1969 as the National Military Wives Association by a group of wives and widows seeking financial security for survivors of uniformed service personnel and retirees. NMFA is the only organization that lobbies Congress on behalf of military families. It tracks legislative issues of interest to military families, and encourages Congress to remember its responsibility to our service members and veterans, and their families. NMFA rated an A, using 82% of its budget for program services, and spending only $9 to raise $100.
These two organizations had the lowest percentages of fundraising expenses of all the organizations rated in this report. At the other end of the spectrum, National Veterans Services Fund spent $97 to raise every $100, and American Veterans Relief Foundation applied only $1 of every $100 towards program services!
So make sure your dollars actually go to the causes you wish to support, and not into the pocket of a third-party fundraising consulting group.
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