Justice 360 – Legal Bulletin: Charitable Giving

In today’s post-9/11 environment, many Muslim Americans have become hesitant to donate to charitable organizations and support worthy causes, out of fear that their funds may be frozen or they may become subject to federal investigation. As a result, many Muslim American donors have either stopped or significantly decreased their charitable giving. Unfortunately, this has had a tremendously negative effect on reputable and effective charitable organizations, who have struggled to find funding for their worthy causes. To address these fears while still providing the financial support that our charitable organizations need, Muslim donors should consider the following guidelines when choosing charities to support.

Make your intent clear. When making a charitable contribution, a donor should make his or her intention to support a specific humanitarian effort or program clear by indicating in writing - e.g., make a notation on the memo line of the check that the donation is intended for feeding the hungry, disaster relief or other charitable projects.

Keep Records. Keep a copy of the cancelled check, bank statement or other written documentation of the charitable contribution, as well as written information from the charitable organization about the program or charitable project that the donor is supporting. The charitable organization should provide the donor with a receipt or acknowledgement of the donation, which the donor should maintain.
Do some basic research on the charity before you donate. Make sure the charity you choose is registered to do business both in the country in which it is based and the county in which it is providing charitable relief. If it is a US-based charity, make sure it is a registered 501(c)(3) tax-exempt charitable organizations. To determine if the organization is a U.S.-registered tax exempt charity, ask the organization, visit its website, or go to www.guidestar.org, an online database of IRS- recognized charities. If the donation is made to an organization that is not based, or does not have existing operations, in the country of the aid recipients, make sure the organization has provided adequate information on the name, qualifications, and experience of the entity that will actually be providing the aid to the recipients. To learn more about a charity and its business practices, a donor can review the organization's annual report, IRS Form 990, financial statements, and audit reports. Organizations typically make this information available on their websites.

Use caution when engaging in overseas wire transfers. If transferring funds to a bank account overseas, the donor should verify that the receiving bank is a legitimate bank and that it is not on a sanctions list. Wire transfers to accounts overseas, especially to the Muslim world, are potentially subject to increased scrutiny from federal law enforcement officials. To avoid undue scrutiny of legitimate charitable giving, the donor may want to consider making a contribution to a qualified U.S.-registered charity.

By following this guidance, Muslim Americans can feel increased comfort that their generous donations will go to the poor and needy who need their help. We can also ensure that effective charitable and relief organizations receive the support they deserve. Before making a donation, please also review the Justice360 Legal Bulletin on Material Support for Terrorism.

The author of this article can be reached via email at Justice360@muslimcongress.org. For more information about Justice360, visit http://www.muslimcongress.org/360.

DISCLAIMER: Justice360° Legal Bulletin’s are meant to assist in the general understanding of the current law relating to the stated topics. JUSTICE360° LEGAL BULLETINS SHOULD NOT BE REGARDED AS LEGAL ADVICE. Organizations or individuals with specific questions should seek the advice of legal counsel.