How To Use Forbes’ Top 100 Charities List To Evaluate Any Charity

Before you donate, do some analysis.gettyBy phone, by TV, by stream, by email and text messages, on social media, in person: Americans are bombarded with ever more pleas from charities, particularly at the end of the year. With two million tax-exempt nonprofits in the U.S.—an astonishing one for every 165 residents—there’s likely to be some new charity that catches your attention. Should you take a risk and donate?The new Forbes list of America’s top 100 charities describes the biggest, collectively receiving $66.5 billion in private contributions, more than one-tenth of the $592 billion given to all nonprofits, according to Giving USA Foundation. Yet the data presented in the Forbes list, along with some simple analytical techniques and a little Internet digging, can help you evaluate almost any charity, big or small, that catches your attention. View the whales as teaching examples for the minnows. Don’t be scared off by a lot of zeros after a digit on a financial filing.How We Pick The Top 100 CharitiesWe start with a description of the Forbes list and its methodology, essentially unchanged since our first annual list was published in 1999. The 100 largest charities are chosen and ranked based on the amount of private support received in the latest fiscal period for which there is available data. It is not a judgmental list based on our opinion (except in those very rare instances when we have thrown charities off the list for accounting we assessed to be wildly deceptive). Certainly, largest is not necessarily the best, although the biggest are frequently the best-known brand names that, in many cases, have stood the test of time. Our collected data generally arrives in one way or another from the charities themselves. Sources include audited financial statements, IRS Form 990 tax returns, annual reports or Forbes survey forms that most of the charities on the list fill out and return at our request. The information covers fiscal years that most often ended in 2024. Some charities turn around their results commendably quickly, others regrettably more slowly. So we have a few results for fiscal periods ending in 2025, and some for periods ending in 2023. The private support we count can be gifts from individuals, their estates, donor-advised funds, corporations, foundations, other nonprofits and federated campaigns, as well as fundraising special events. What we don’t include are government grants (they are public, not private), revenue from sales or services (business transactions) and investment returns. Donations can be in the form of cash, securities, goods, real estate and even labor and services if the charity is able to quantify that in its reports (many don’t). For us, a contribution must be based on pure charitable intent. That means the donor receives nothing back beyond the satisfaction of supporting a favored cause (and maybe a tax break covering part but not all of the donation). So we don’t count as a private donation membership dues, reckoning that the donor/member is receiving back a thing of value, like reduced admission fees to a museum. For each charity we list separately private support and government support. Everything else coming in is included in other revenue, and the three categories added together as total revenue. Since our list focuses on charities that may make appeals or welcome support in some way to the general public, we don’t evaluate certain categories of nonprofits. Among them: purely academic institutions (which tend to concentrate on their own alumni), donor-advised funds often run by some of the big financial companies (these are not operating charities but a holding vehicle for money donated by individuals that will eventually go to a nonprofit), and the many religious entities that aren’t required to make public their financial information (an obvious exclusion). We also avoid nonprofits with very few direct donors (such as virtually every private foundation) and charities that receive most of their donations indirectly from federated campaigns, community chests and such vehicles. Each year we review hundreds of nonprofits to figure out the 100 largest by our metrics.Now we’re getting to the stuff that can really help you. For each of the 100 charities, we calculate three financial efficiency ratios, while also indicating the direction of change from the prior year if available. These are the numbers that get you on the path of intelligent analysis of any charity in the country. We must add a forceful caution here. Do not compare efficiency ratios for different kinds of charities. The ratios for a museum or foreign aid provider can’t be meaningfully compared with those of, say, a hospital or a single-illness charity. But within the same category, the ratios can be very illuminating. The Forbes list covers a wide range of categories, including health care, domestic and international needs, environmental, animal welfare, religious and youth.Say you’re looking at donating to your local food bank (there are hundreds around the country). After finding their financial statements (we’ll explain how below), you can compare its financial efficiency ratios to the eight food banks on our list. Since they’re bigger, some of their financial efficiencies might be better. But if the ratios at your charity of interest are a lot worse, consider contacting it and asking for an explanation. Another big caution: Financial efficiency measures are simply a starting place for analysis by a would-be donor. Overhead, a direct or indirect component of these calculations, is not in and of itself bad. Like any enterprise, charities have to pay for things like rent, insurance and utilities. The goal is to identify those charities with out-of-sync ratios—often due to wildly high fundraising costs—and no good reason for them that is acceptable to you.Information needed to calculate efficiencies of many nonprofits can be found on the IRS Form 990 tax return (parts VIII and IX), a formal financial statement or a charity’s annual report. In a welcoming trend, many charities now post some or all of these documents on their own websites. (The IRS lets charities with annual gross receipts below $200,000 and end-of-year total assets of less than $500,000 file a far-less-revealing form called the 990-EZ, or, if the annual gross receipts are normally below $50,000, a 990-N, which literally is an electronic postcard that provides no meaningful financial information.) On the website of your charity of interest, poke around for a link to something like “financials,” “financial information,” “financial statement” (singular and plural), “accountability,” “990,” “annual report,” “filings” “stewardship” or “about us.” Regrettably, a few charities post the data but make that hard to find. We won’t name names now. So try punching those same terms into a search box usually found on the home page. No luck? Perhaps a reason to think twice about donating. Note that many filings can be downloaded for free from Candid, ProPublica and, even if the charity isn’t based there, often the New York State Attorney General’s Office[JN1] [WB2]. Or just contact the charity itself and ask for a set of filings to be emailed or mailed. You have a legal right under IRS regulations to receive the 990, but also ask for the audited financials, which sometimes have interesting footnotes. Technically, the charity can charge a modest fee for the 990, but few do.Forbes’ Financial Efficiency RatiosHere’s the skinny on the financial efficiency ratios we calculate, and what they mean: CHARITABLE COMMITMENT This reveals how much of a charity’s total expense went directly to its charitable purpose (also known as program support or program expense), as opposed to management, certain overhead expenses and fundraising. The math is simple: program support expense divided by total expense. On a 990, it’s the number on Part IX, Statement of Functional Expenses, line 25(B) divided by line 25(A). The average this year is 87%, unchanged from the past few years. Higher is better, and we show the trend from the previous period if available. Charities receiving most of their donations as gift-in-kind (for example, those that collect medicines or food from producers for distribution) fare a lot better here, mainly because individual gifts are larger and involve little or no fundraising expense. Charity watchdogs such as the Better Business Bureau Wise Giving Alliance say charitable commitment should be no lower than 65%. All the charities on our list are above that.

Save The Children’s is 84%; International Rescue Committee’s is 86%. (Those are the two international humanitarian charities discussed in our story here.) FUNDRAISING EFFICIENCY This closely watched measure calculates the percent of private donations remaining after deducting the costs of getting them. Here in words is the formula: private donations minus fundraising expense, with this result divided by private donations. On the IRS Form 990, it’s a little more complicated, but here it is: Part VIII Statement of Revenue line 1h(A), plus line 8c(A) minus line 1b minus line 1e, plus Schedule D Supplemental Financial Statements Part XI Reconciliation of Revenue Per Audited Financial Statement, line 2b. This is private support. From this sum, subtract Part IX, line 25(D) for fundraising expense. Then divide this amount by the amount you calculated for private support. The average for all top 100 charities is 91%, the same as last year. In other words, it costs 9 cents to raise $1. Again, we show the trend from the previous period if available. But the 91% average embraces many different kinds of charities using many different fundraising procedures. With fewer but larger donations and possible puffed-up asset valuations, some gift-in-kind charities look very efficient, with fundraising efficiencies of 100% (rounded) or very close. At the other end are charities employing expensive direct-mail and telephone solicitation to collect cash. While the BBB considers 65% to be the bottom of acceptability, at Forbes we have long considered the line to be 70% or above. Again, no charity on the list is below 70%.

Save The Children clicks in at 83% while International Rescue Committee sits at 86%. DONOR DEPENDENCY This interesting ratio calculates how badly a nonprofit needed private donations to break even and could become a more important indicator in future years for some charities if federal funding stays reduced. The formula in words: private donations minus surplus, with this result divided by private donations. On the IRS Form 990, it’s the amount calculated under financial efficiency above for private support minus Part I Summary line 19 for current year, with this result divided into financial support. A ratio of 100% means revenues were the same as expenses. A ratio above 100% means the charity had more expenses than revenue. A negative ratio (below 0%) means the charity had an annual surplus greater than all private donations! (This is often a hospital, such as No. 26 Mayo Clinic, which in the fiscal year ending December 31, 2024, received $700 million in donations but posted a surplus of $3.8 billion, generating a donor dependency ratio of -446%). The average for this year’s list is 68%, meaning the typical charity was able to put away 32% of donations for the future. Last year’s average ratio was sharply higher, 81%, meaning 19% of donations were banked. Annual differences are often largely due to varying investment returns, and financial markets have been doing well. What makes this ratio interesting is the interpretation. For the other two ratios, the higher the ratio, the better, especially in reviewing year-to-year change. But the meaning of this ratio depends on the donor. Should the donor be seeking a charity that badly needs contributions it is likely to put to work immediately, a ratio above 100 might be considered good. On the other hand, if the patron is looking for a charity that can better stand on its own long term, a ratio below 100—but not too far below—might be seen as better. This ratio tends to reveal charities pleading for money that actually have substantial financial reserves or other kinds of revenue.

Save The Children’s ratio was 95%.

For International Rescue Committee, the figure was 88%.

How To Find Further InformationYes, the Internet is a terrific place to find more information—and sadly, sometimes, misinformation. Use Google to run the name of your charity of interest (but beware names of similarly sounding charities, which especially can be a problem with little-known nonprofits containing the word “cancer” in their name). Run the same search on Bing, which frequently will put different material at the top of the search results. Then repeat the same searches again but add the word “scam” or “fraud.” Do this all again using an AI-powered application. This can be a quick way of getting to any derogatory information. But be sure the underlying sources are legitimate.The Better Business Bureau Wise Giving Alliance (www.give.org) is one of several charity watchdogs that can provide an evaluation of a specific charity if it is of any size, but the review centers mainly on good-governance issues. Consider avoiding a charity that declines to provide information to the BBB. Another helpful source is Charity Navigator. Charity Watch is useful, although it is largely a paid service. Also, every state has a governmental office, usually located in the state capital, that regulates charities and can be contacted to see if there are complaints. The online IRS Exempt Organization Search database will let you check if a donation to your charity of interest qualifies for a tax deduction.Finally, here’s our annual update on a rare big-charity financial-efficiency-related legal matter that now has lasted longer than World War II. It involves No. 52, Food for the Poor, of Coconut Beach, Florida, and No 68, Catholic Medical Mission Board, of New York. In a civil administrative proceeding started in 2018, the California Attorney General’s office, seeking penalties, had accused the charities of exaggerating both the value of donated goods and financial efficiencies in solicitations to California donors. The charities denied wrongdoing. An administrative law judge tossed much of the case, but found there was deception in stated financial efficiency ratios and upheld the $1.5 million in civil penalties the AG sought against the charities. (A third charity on our list that the AG went after on the same grounds, No. 16 MAP International, of Brunswick, Georgia, settled in 2020, admitting no liability but agreeing to pay the AG $80,600). However, on appeal a trial judge threw out the rest of the case against Food for the Poor and the Catholic Medical Mission Board, including the penalties, partly on First Amendment grounds. Adding to the AG’s insult, the judge granted a permanent injunction to bar the agency from enforcing relevant parts of the state’s charity law. But in March, a California appeals court overturned the injunction mainly on grounds it had not been properly pleaded and sent it back to the trial judge. The two charities then filed papers seeking another injunction. A hearing on that is scheduled in Los Angeles for April 2026. Stay tuned.