Where Should You Donate?

The American Institute of Philanthropy, which runs http://www.charitywatch.org, also evaluates nonprofit organizations. Daniel Borochoff, the president and founder of the group, said what differentiates his group is that it does a full financial analysis, looking at where cash goes and asking charities questions if it thinks they're being vague.

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The AIP looks at the Form 990, the charity's audit and its annual report to get a complete picture of its activities.

"It's the difference between kicking the tires and taking the car out for a test-drive," Borochoff said.

Borochoff said some charities are able to disguise solicitations as a program. For example, some include an educational message in a mailed solicitation, making the solicitation cost into a program cost. The AIP tells people how much the charity spends on programs that are not solicitation-related, Borochoff said.

The AIP, a nonprofit itself, relies on individual donors and charges for its charity guide, though it offers free samples.

The BBB Wise Giving Alliance, formed in 2001 by the National Charities Information Bureau and the Council of Better Business Bureaus' Foundation, looks at more than just administrative costs. It considers truthfulness, privacy policies and governance as part of its 20 standards.

The BBB Wise Giving Alliance reports on more than 1,100 organizations, based on requests from potential donors. H. Art Taylor, chief executive of the organization, said charities can have reasonable administrative or overhead costs but still not meet other criteria.

"Charities are a lot more than what they spend on program and administrative costs," he said.

The BBB Wise Giving Alliance uses audited financial statements, solicitation materials, governing documents, policies and annual reports. Its reports are free. Charities that meet its standards can pay a fee to use the BBB Wise Giving Alliance seal on their Web sites and solicitation materials.