With the end of the year quickly approaching many of us are packing up our bags of shirts, jeans and other household items. It's a win, win situation for all involved! You can benefit from a tax break and knowing that you helping a worthy cause. Various organizations benefit by processing your donations to generate money for services and programs. However, just be careful where you are donating your items.

Recently, a news story ran in USA Today’s Money Section about clothing donations and for-profit companies. According to Dave Barringer, Goodwill Industries International vice president of Member Relations, “The piece reinforces Goodwill’s donor education message and cautions donors to know to whom they are giving.” When you donate your items to a for-profit thrift store that has a slight connection or doesn’t have any connection at all to a charity it deprives legitimate charities of an important source of income.

The article highlighted a current trend of for-profit companies presenting themselves as charities. For example, last year, the Illinois Attorney General charged a man with using a local charity’s name on his clothing drop boxes and then selling the donations in his own stores. Several state regulators have taken action against for-profit companies that have used charities’ names on drop-off bins without permission from the charities.

There are three different donor models:

• For-profit businesses that do not donate any of their proceeds to charity, even though their names may resemble those of philanthropic organizations.
• For-profit businesses that may donate a portion of their sales to charity.
• Bona fide charities whose mission is to process donations in order to generate money for services and programs to help less fortunate people in society.

Goodwill Industries of Southeastern Wisconsin and Metropolitan Chicago provided services to 11,389 individuals in 2006. Our donations also helped to fund training, employment and support services, many of which prepare people for employment.

Here are some tips provided from The Better Business Bureau’s Wise Giving Alliance to ensure that your choice of charity is really the recipient of your donation.

• If you get a call from an organization soliciting donations, ask the caller which charity will benefit and how much of the proceeds the charity will receive.
• Before donating to a thrift store, ask the employees for information about the charity that it claims to support and contact the charity for confirmation.
• Verify that drop boxes are connected to the charity. (Some have phone numbers on them that you can call for information)