TaxNewsFlash-Exempt Organizations

March 13, 2008
No. 2008-22

Abuse of Charitable Organizations and Deductions Remains on IRS “Dirty Dozen” List of Tax Scams

According to an IRS release (IR-2008-41, March 13, 2008), the abuse of charitable organizations and deductions is one of the 12 “dirty dozen” tax scams identified by the IRS.

The IRS noted that it continues to observe the misuse of tax-exempt organizations. Such misuse includes arrangements that are intended to improperly shield income or assets from taxation; attempts by donors to maintain control over donated assets or income from donated property; and overvaluation of contributed property.

The IRS also reports IRS examiners have been seeing an increase in instances when taxpayers try to disguise private tuition payments as contributions to charitable or religious organizations.

The IRS urged taxpayers to avoid “these common schemes.”

For more information, contact Rick Speizman, National Partner-In-Charge, KPMG’s Exempt Organizations Tax Practice (ExoTax), at (202) 533-3084 or rspeizma@kpmg.com

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