Major Tips to Avoid Charity Tax Deductions Scams

There are many individuals and groups those are pretending to be charitable organizations. These fake organizations are active during the tax seasons in order to attract donations from Americans who are looking for some tax reduction. According to the IRS, these are turned out to be Dirty Dozen Tax Scams for the 2017 filing season.

IRS Commissioner John Koskinen said that Fake charities set up to steal the money or personal information are a recurring problem. The taxpayers should take the responsibility and research the organizations whether they are legit before giving their hard-earned money. Dirty Dozen scams list a variety of common scams, which the taxpayers will encounter anytime. But many occur during the tax filing season as the taxpayers are busy in preparing their returns or hire any tax professionals to prepare their taxes.

Illegal scams will face the IRS penalties and interest and possible criminal prosecution. IRS criminal investigation works with the Department of Justice to shut down the scams and accuse the 990-N

IRS Tips to the Taxpayers to Avoid Charity Scams

The IRS provides some basic tips to the taxpayers before making the charitable donations:

  1. Be more cautious with the names of the charities, which are similar to the nationally known charity organizations or sounds familiar. Some scam charities might use the websites and name that sound similar to legitimate organizations in order to disguise themselves and pretend to be real. Legitimate charities have a valid Employer Identification Number (EIN) and provide them when required. Through EIN, the taxpayers can check and verify whether the legitimacy through EO Select Check.
  2. Never provide your personal information like passwords or Social Security Number to anyone who solicits a contribution. Scammers can use this information to steal money and identities from the people. When using credit cards for donations, beware while disclosing the number.
  3. Never send or give cash to the trusts. For certain security and tax purposes, contribute the donations through credit card or check in order to document the records.

Imitation of Charitable Organizations

Another important and popular abuse involves the scams that happen during the natural disasters.  It is more common for the scammers to impersonate the charities to receive the money or private information from the taxpayers. Scammers have a variety of tactics to play around the taxpayers to fetch money from them. There are scammers who are operating bogus charities, will contact the people through mail or phone call to solicit the money or financial information.

Even the scammers can contact the disaster victims directly and claim to be working on behalf of the IRS to help the victims file their casualty loss claims and get their tax refunds on time. Fraudsters get the personal financial information or Social Security Number, which can be used to steal the victim’s identities.

To assist the disaster victims, the IRS advised the taxpayers to donate to a well-recognized charity. Victims of any disasters may call the IRS toll free assistance telephone number at 866 562 5227. The receivers will answer your queries related to tax relief or disaster tax issues.

The taxpayers can find qualified and legitimate charities through Select Check Search tool on the website This can be done using the EIN of the organizations.


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