By SDCN Editor
Washington, D.C.–In the sixth part of the “Dirty Dozen” tax scams for 2024, the Internal Revenue Service warned taxpayers about groups masquerading as charitable organizations to attract donations from unsuspecting contributors.
In natural disasters and other tragic events, it’s common for compassionate individuals to donate money to help the victims. Unfortunately, scammers often use fake charities as a cover to not only obtain money but also gather sensitive personal and financial information that can be exploited for tax-related identity fraud.
“We see repeated instances of scammers using major disasters as a way to prey on well-meaning taxpayers,” said IRS Commissioner Danny Werfel. “In these tragic situations, many people want to help, but con artists too frequently come in posing as charitable groups to take advantage of the situation, stealing money and personal information. People should remember it’s important to never feel pressured to give donations immediately. They should do some research and only donate to clearly established charities that help victims.”
Fake charities mark day six of the Dirty Dozen. Started in 2002, the IRS’ annual Dirty Dozen campaign lists 12 scams and schemes that put taxpayers, businesses, and the tax professional community at risk of losing money, personal information, data, and more. While the Dirty Dozen is not a legal document or a formal listing of agency enforcement priorities, the education effort is designed to raise awareness and protect taxpayers and tax pros from common tax scams and schemes, including fake charities.
As a member of the Security Summit, the IRS has worked with state tax agencies and the nation’s tax industry for nine years to cooperatively implement a variety of internal security measures to protect taxpayers. The collaborative effort by the Summit partners also has focused on educating taxpayers about scams and fraudulent schemes throughout the year, which can lead to tax-related identity theft. Through initiatives like the Dirty Dozen and the Security Summit program, the IRS strives to protect taxpayers, businesses, and the tax system from cyber criminals and deceptive activities that seek to extract information and money, including fake charities.
During times of disasters, fake charities become a concern. These deceitful organizations are created by scammers who exploit people’s generosity. They solicit money and personal information to victimize individuals through identity theft.
When taxpayers decide to contribute funds or goods to an organization, they may qualify for a deduction on their tax return, but only if they itemize their deductions. Remembering that charitable donations are valid when directed toward IRS-recognized tax-exempt organizations is important. Individuals intending to donate can utilize the Tax-Exempt Organization Search (TEOS) tool on IRS.gov to ensure legitimacy.
Beware of scammers who might use email communications or manipulate caller IDs to deceive people into donating funds to charities. These fraudsters often target groups such as seniors and those with limited English proficiency.
Here are some helpful tips to avoid getting scammed:
Don’t give in to pressure. Scammers often create situations to get people to make payments. Genuine charities are always grateful for donations. Donors should take their time and research before making a charitable contribution.
Exercise caution when making donation payments. Avoid any charity that requests gift card numbers or wire transfers. It’s better to pay by credit card or check after ensuring the charity’s authenticity.
Verify the legitimacy of the charity. Scammers often use similar-sounding names for charities to confuse people. Before donating, potential donors need to ask the fundraiser for the charity’s name, website, and mailing address so they can independently verify its authenticity. Use the special IRS TEOS tool to confirm an organization is a legitimate tax-exempt charity.
Avoid sharing too much information. Scammers are always on the lookout for both money and personal data. Never disclose Social Security and credit card numbers, or personal identification numbers. Only provide bank or credit card details after confirming the charity’s legitimacy.
As part of the Dirty Dozen awareness effort regarding tax schemes and unscrupulous tax return preparers, the IRS encourages individuals to report those who promote abusive tax practices and tax preparers who intentionally file incorrect returns.
To report an abusive tax scheme or a tax return preparer, people should use the online Form 14242.
