Criminals and fraudsters often see disasters as an opportunity to take advantage of victims when they are the most vulnerable, as well as the generous taxpayers who want to help with relief efforts. Generally, these disaster scams start with unsolicited contact – typically a phone call, on social media, by email, or even in person. Reviewing the tips listed below will help taxpayers recognize a scam and avoid becoming a victim.
- Some thieves pretend they are from a charity. They do this to get money or private information from well-intentioned taxpayers.
- Bogus websites use names like legitimate charities. They do this scam to trick people into sending money or providing personal financial information.
- Pretending to be the IRS. Scammers even claim to be working for – or on behalf of – the IRS. The thieves say they can help victims file casualty loss claims and get tax refunds.
- Use a check or credit card. Taxpayers should always contribute by check or credit card to have a record of the tax-deductible donation if they choose to give money.
- Avoid giving out personal information. Donors should not give out personal financial information to anyone who solicits a contribution. This includes things like Social Security numbers or credit card and bank account numbers and passwords.
Taxpayers should also be aware that sometimes when they search for a charity online, they may be directed to a website or social media page that is not affiliated with the actual charity. If in doubt, the best way to check an organization’s eligibility to receive tax-deductible charitable contributions is to visit the Tax Exempt Organization Search tool on the IRS website, IRS.gov. Donations to qualified charities are usually tax-deductible.
If you are a disaster victim, you can call the IRS toll-free disaster assistance line at 866-562-5227. When you call, you will be connected to a phone assistor who will answer questions about tax relief or disaster-related tax issues.
Finally, as a reminder, individual taxpayers can deduct up to $300, and married couples can deduct up to $600 in qualifying charitable contributions for tax year 2021. Itemizing is not necessary.
As always, don’t hesitate to contact the office if you have any questions about charitable contributions or disaster relief and how it affects your tax situation.
Any accounting, business or tax advice contained in this communication, including attachments and enclosures, is not intended as a thorough, in-depth analysis of specific issues, nor a substitute for a formal opinion, nor is it sufficient to avoid tax-related penalties. If desired, we would be pleased to perform the requisite research and provide you with a detailed written analysis. Such an engagement may be the subject of a separate engagement letter that would define the scope and limits of the desired consultation services.