While there are those who let the world know of their deeds of charity, there are those who like to stay anonymous about their acts. People may choose to be anonymous for various reasons. Age old saying goes that your left hand must not know what the right hand gives away in charity.
While many may shun the limelight, staying anonymous will also avoid hostility from those who are philosophically opposed to the causes you support and will also avoid being pestered by other fundraising requests.
For some, it is also a matter of safety to stay anonymous about their wealth and attack on a person or personal assets. Staying anonymous is also a sign of humility on part of the giver so that the receiver does not feel inferior and the giver does not feel superior.
Giving anonymously is not very easy. Before donating to a particular organization or cause check them out for credibility. Here are reasons why it is difficult to stay anonymous while donating.
Private foundations: Setting up a private charity foundation will give you a lot of control over investments and charity. Although it offers control over investments, it does not allow one to remain anonymous as the Federal law requires that the private foundations must report the names of contributors. Those who donate large amounts during a taxable year on their annual tax returns must be maintained on public record to keep away from abuse.
Public charities: Just like private foundations, public charities too must maintain and report the names of contributors to the Government or to anyone who enquires about their source of funds, value and type of assets donated. There are many who also like to boast about their funding sources and the chances of staying anonymous for too long are unlikely.
Intermediates: Law firms, banks or other trusted advisers may act as intermediates to guarantee anonymity. They can help protect your identity while delivering the gift to the deserving charity organization. The advisors can also get the tax receipts for you while you stay anonymous. Any receipt from the organization can be addressed to the anonymous donor.
Donor advised fund: It is a public charity wherein the individuals and groups can donate to nonprofit organizations. An individual can set up a donor-advised fund account at a community foundation, university, religious organization or commercial gift funds. The only matter of concern here is that you are no longer in control once the donation is made to the organization, but they do ensure donor anonymity on demand. The organization will have your name but will not disclose it.
Online donations: There are websites that accept gifts and act as a clearinghouse for charitable donations. They are much like donor advised funds with just a variation that they use the donor’s credit card to make the donation. Here one may choose to remain anonymous or known to the recipient charity organization. Both ways you will get a tax receipt. Trusts, donor advised funds, limited liability companies can be set up by those who wish to make donations on a continuous basis. Online donations are ideal for those who donate occasionally.