Donating to a charity is a valuable endeavor, and itemizing deductions can even bring some financial benefits during tax purposes. However, whether you’re making a donation to a charity for the first time or supporting your favorite purpose for years, it’s a good idea to make sure your donation is safe and the charity is legal.
Criminals have the opportunity to fly under radar and impersonate real charities, especially during social unrest, global health crises, or disasters. We need to continue to support philanthropy, but it is important to support it safely. Here’s how to avoid fraud when donating to a charity:
1. Avoid inbound solicitation
There are many ways criminals can pass as a legitimate charity. They may create a fictitious organization from scratch or use a name similar to a real charity to seduce an unsuspecting donor.
You may want victims seeking donations to take action, such as clicking a link or downloading an attachment by email. They may want the victim to provide personal information over the phone. They may have plans to put your money in your pocket, steal your identity, or install ransomware on your computer.
You can avoid phishing scams by ignoring incoming requests such as emails and phone calls, even if they appear to come from a legitimate organization. Do not follow links, download attachments, or provide information over one-sided phone calls. When you’re ready to make a donation, go directly to the charity’s website.
2. Investigate charities
Criminals may set up fake organizations to prey on sympathetic donors in response to current events such as coronavirus pandemics and Black Lives Matter protests. Donations may disappear and are not tax deductible. You can check if your organization is legal by investigating online for a few minutes.
Charities must be registered with the IRS as a 501 (c) (3) organization for donations to be tax deductible. To make sure your donation is tax deductible 501 (c) (3) Organizational IRS List..
For further investigation, you can check out charity rating websites like Charity Navigator Or GiveWell.. These sites provide information about thousands of legitimate charities, including data on how efficiently donations are being used to serve their purposes.
You can also see the state’s local resources for charities. Look for complaints. If you find evidence of multiple complaints online or in your state, think of it as a warning sign.
3. Make a safe donation
Legitimate charities can accept donations using common payment methods such as cash, checks, credit cards and PayPal. If a charity requires a particular payment type, such as cash, this should be considered a red flag. If you need an unusual payment type, such as a gift card, it’s an even bigger warning sign.
Credit cards are one of the safer donation options.. They have built-in legal protection, provide a record trail of your donations and are not tied to your bank account. If you donate online, look for the padlock icon in your browser to indicate that you are visiting a secure website.
When you’re ready to make a donation, go directly to the charity’s website for donation procedures. If you do not need to donate, please do not provide personal information such as your social security number or bank account number. Be careful where you share your information, as even physical addresses can be fraudulent or steal your personal information.
Looking for a charity donation?Follow these best practices to avoid fraud
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