INDIANA — As the holiday season approaches and giving campaigns ramp up, the Internal Revenue Service (IRS) is issuing a critical warning to taxpayers: Do your research before donating to charities. The warning comes amid heightened concern that various scams—including fake charity promoters—are exploiting crises and natural disasters to solicit fraudulent donations.
Fraudsters are becoming increasingly sophisticated, using tools like emails, fake websites, and altered caller ID to impersonate legitimate charitable organizations. The goal is to pressure kind-hearted individuals, especially those looking to assist communities affected by recent disasters, into making immediate, unverified payments.
The IRS emphasizes that being cautious is the best defense against these schemes.
Key Tips to Protect Your Donation
To help safeguard their clients against donation scams, tax professionals and the IRS offer the following essential tips for verifying a charity’s legitimacy:
- Verify the Charity’s Identity: If contacted by a solicitor, ask for the exact name, website, and mailing address of the organization. A legitimate charity will be happy to provide this information.
- Use the IRS Verification Tool: Use the Tax Exempt Organization Search (TEOS) tool on the IRS website to confirm that the organization is a valid 501(c)(3) tax-exempt entity and that contributions are tax-deductible.
- Resist Pressure: Do not feel pressured to make an immediate payment. Legitimate charities welcome donations at any time and will not rush a donor.
- Choose Safe Payment Methods: The safest ways to donate are by credit card or check written directly to the organization. Avoid providing gift cards or wire transfers, as these payment methods are virtually untraceable and are typical hallmarks of fraud.
Report Suspicious Activity
If you encounter a suspicious or fake charity, the FBI advises reviewing its resources on Charity and Disaster Fraud and reporting the activity. This helps law enforcement track down and stop these fraudulent operations before more people become victims.
By taking a few minutes to verify a charity’s status, donors can ensure their generosity supports those truly in need.
