The IRS has issued a warning as part of its annual "Dirty Dozen" tax scams, alerting individuals about the prevalence of fake charities exploiting people's generosity, particularly during natural disasters and tragedies. These fraudulent organizations not only seek monetary donations but also gather sensitive personal and financial information for identity theft.
As part of the Dirty Dozen campaign, the IRS emphasizes the importance of verifying the legitimacy of charities before making donations. People are urged to utilize the Tax-Exempt Organization Search (TEOS) tool on IRS.gov to ensure that the charity is IRS-recognized. Additionally, individuals should be wary of scammers using email or phone calls to solicit donations, especially targeting vulnerable groups like seniors.
To avoid falling victim to these scams, the IRS provides several tips:
- Don't succumb to pressure: Genuine charities appreciate donations without pressuring individuals. Take time to research before contributing.
- Exercise caution with payment methods: Avoid charities requesting gift cards or wire transfers; opt for safer methods like credit card or check payments after confirming legitimacy.
- Verify charity authenticity: Request the charity's name, website, and mailing address for independent verification. Use the IRS TEOS tool to confirm tax-exempt status.
- Avoid oversharing personal information: Protect sensitive data like Social Security and credit card numbers. Only provide such information after confirming the charity's legitimacy.
Individuals are encouraged to report abusive tax practices and fraudulent tax preparers. Reporting can be done using Form 14242, Report Suspected Abusive Tax Promotions or Preparers, either online or via mail or fax to the IRS Lead Development Center. Reporting may also be eligible for monetary rewards through the IRS Whistleblower Office.
By following these precautions and reporting suspicious activities, taxpayers can protect themselves and contribute to combating fraudulent practices in charitable giving.
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