Taxpayers need to be wary against scam groups masquerading as charitable organizations, luring people to make donations to groups or causes that don't actually qualify for a tax deduction. These ‘fake’ charities attempt to attract donations from unsuspecting contributors, using a charitable reason and a tax deduction as bait for taxpayers. Fake charities are one of the “Dirty Dozen” tax scams for the 2018 filing season.
Compiled annually, the “Dirty Dozen” lists a variety of common scams that taxpayers may encounter anytime, but many of these schemes peak during filing season as people prepare their tax returns or hire someone to prepare their taxes.
Perpetrators of illegal scams can face significant penalties and interest and possible criminal prosecution. To help protect taxpayers, IRS Criminal Investigation works closely with the Department of Justice to shut down scams and prosecute the criminals behind them.
The IRS offers these basic tips to taxpayers making charitable donations:
Another long-standing type of abuse or fraud involves scams that occur in the wake of significant natural disasters. Some scammers operating bogus charities may contact people by telephone or email to solicit money or financial information. Others may directly contact disaster victims and claim to be working for or on behalf of the IRS to help the victims file casualty loss claims and get tax refunds.
If you have any questions about the legitimacy of a charitable organization, use the TEOS or contact us.
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