When you donate to support a cause, you want that donation to count. However, what if it doesn’t? That is why the Indiana Department of Revenue is encouraging Hoosiers to research any charity organization to ensure the organization is legitimate. Here are some tips to avoid being a victim of charity fraud:
- Check with the IRS on charity legitimacy. Ask the charity for their Employer Identification Number (EIN). The EIN can be used in the IRS search tool for tax-exempt organizations to verify their status at Tax Exempt Organization Search.
- Don’t share any personal or financial information. Keep Social Security numbers, passwords or financial information, such as credit card numbers private. Scam artists will use this information to take money or steal the victim’s identity.
- Don’t give or send cash. Be sure to send a check or use a credit card once the charity has been verified, and keep that as a record of your donation for security and tax record purposes.
- Consult the IRS publication on charitable contributions, available here. This free booklet describes the tax rules that apply to making tax-deductible donations and provides complete details on what records taxpayers need to keep.
Scams that happen during a natural disaster are also a common type of charity fraud. The DOR says beware of any organization that is not a recognized charity established to help disaster victims.