First, you should ensure that you have either a Premier Account or a Business Account, a Personal Account won't work. By having either a Premier or Business Account, this enables your donors to use a credit card without being required to open a PayPal Account. Keep in mind, you would still pay the standard transaction processing fees (2.9% plus $.30 per transaction), same as selling an item even though you are collecting money for a cause.
To create your Donation item button code, see the info here: https://www.paypal.com/webapps/mpp/get-started/donate-button
Note, when you go to create your item button code, you will see the following message:
"This button is intended for fundraising. If you are not raising money for a cause, please choose another option. Nonprofits and or must verify their status to withdraw donations they receive. Users that are not verified nonprofits must demonstrate how their donations will be used, once they raise more than $10,000."
In the past this was not an issue as probably 1000's of people currently have donation buttons on their web sites and blogs and they are not nonprofits or registered 501(c)(3) organizations, just individuals.
Having said all of that, if you are not a Nonprofit or 501(c)(3) Organization, it appears you can still use the Donation item button code as long as don't think you will ever raise $10,000 or more. Should you rasie more than $10,000, make sure that you documentation to back up your cause.
