Recognizing a Charity Scam
The season of charitable giving is upon us and Americans are known for donating the most during the holiday season. In fact, Blackbaud’s 2016 Charitable Giving Report reported that out of the $23 billion in charitable donations made in 2016, about one in five came in December alone. You can be sure there are charity scammers out there who would like to trick you out of your donation and they use many of the same mediums we are familiar with: emails, letters, social media, and phone calls. So that you can be sure your giving goes where you want it, be aware of the following:
Quick signs to look for:
1. The person making the “Ask” gives almost no information about the organization.
• Be sure the person gives you the full name of the charity, and his or her full name.
• Ask for more information about the organization before you agree to give.
• Before you give, ask about the charity’s mission, goals, and accomplishments to illustrate their ability to achieve those ends. Cross-reference that information with other sources readily available such as Charity Navigator and Guidestar.
2. The person making the “Ask” cannot provide proof that your contribution is tax-deductible.
• Remember that donations made to nonprofit organizations are tax-deductible, but not all charities are nonprofits.
• Tax-exempt is NOT the same thing as tax-deductible.
• If the organization says it is tax-exempt that means it doesn’t pay taxes to the government, not that you won’t have to.
• It’s best to check for yourself to be sure your donation is tax-deductible. You can check the IRS online database to see if the organization is eligible to receive tax-deductible donations.
3. The person making the “Ask” puts pressure on you to make an immediate donation.
• Rushing the donation process is always a bad sign and a red flag. This is especially true if, for instance, the caller volunteers to send a person to collect your donation or asks you to wire the cash immediately.
4. You receive an acknowledgement letter thanking you for your gift, but you cannot recall making a donation to the organization.
• If this happens, you may be the target of a charity scam. This could be the sign of identity theft, or a way a scammer might be persuading you to give more money by convincing you that you have given previously.
• Double-check your records and always ensure a charity is legitimate before donating.
• Keep a record of your donations to verify a caller’s claim.
• Check your accounts and credit report for signs of fraud or identity theft.
• If necessary, file a complaint with the IRS.
Make your donations count this giving season.
Waccamaw Community Foundation is here to serve you. Even if you don’t recognize any of the red flags mentioned above, we can help you be sure that a charity is legitimate before you give.
Including charitable giving as part of a well thought out financial plan is not only emotionally gratifying – it can reduce estate taxes too. Waccamaw Community Foundation is your first resource and partner in all things charitable. Karen Minogue is poised to help you set up a charitable fund in as little as one day to support the causes you care about.
Call Karen at 843-357-4483 or e-mail her at [email protected] to find out more.
The purpose of this blog is to provide general gift, estate, and financial planning information. Always discuss your plans with your attorney, accountant or financial advisor.