Fake Charities on the IRS’ “DIRTY DOZEN” List

During tax season, we all have enough to worry about. We’re gathering all our tax documents, including those nice deductions from charitable deductions.

Are you sure all those donations were made to a qualified charity?

The IRS warns taxpayers about groups masquerading as charitable organizations to steal donations. “Fake charities set up by scam artists to steal your money or personal information is a recurring problem,” says IRS Commissioner John Koskinen. “Taxpayers should take the time to research organizations before giving their hard-earned money.”

How can you keep this from happening to you?

Follow these four tips when making charitable donations:

1. Only donate to known, qualified charities. Fraudulent charities sometimes use names or websites that are similar to legitimate charities. IRS.gov has a search feature, Exempt Organizations Select Check, so you can check for qualified charities.

2. Watch for bogus donation solicitations after a major disaster event. Another long-standing scam that occurs after major disasters is to impersonate charities to get money or private information from well-intentioned taxpayers. Scam artists use a variety of tactics, such as contacting people by web or phone solicitations, or going directly to disaster victims and claim to be IRS workers.

3. Don’t give out personal financial information. Scam artists may use Social Security numbers or passwords to steal your identity and money. People make legitimate donations using credit cards but don’t give out your information when speaking with someone who has called you. Confirm the organization and call them back, or make the donation online.

4. Don’t give or send cash. For security and tax record purposes, contribute by check or credit card or another way that provides documentation of the gift.

You work hard for your money. Following these tips could prevent you from “donating” your money to a scam artist instead of a qualified charity.

Identity Theft and your Taxes

Incidents of identity theft have increased annually for several years. They spike during tax filing season, when scammers use bots to robo-file fraudulent returns to get fake refunds and other methods. This year, the IRS has partnered with state revenue departments and tax software providers to add some security features.

What does that mean to you?

It means taking precautions and providing some additional information to verify your taxpayer identity. For example, some states tax agencies require information from a state-issued ID, such as a driver’s license. That information is matched against the state’s records to prove that you are you before issuing a refund. Other precautions are “behind the scenes” and not visible to taxpayers (or tax preparers).

More changes are down the road.

The IRS is piloting an Identify Protection Personal Identification Number (IP PIN). For those in the pilot program, the IP PIN is required to file a return. Taxpayers who were tax fraud victims in prior years have also been issued an IP PIN that should be used to file 2015 returns.

The IRS’ Criminal Investigation unit tracks down and prosecutes tax scammers – over 2,000 cases in the last three years. But the scammers are not deterred, based on the volume of taxpayer reports. By focusing on prevention, the IRS hopes to reduce opportunities for your identity to be stolen.

During this tax filing season, and throughout the year, diligently guard your personal financial information.

Falling for a fraud or scam can cost you incredible amounts of time and money, and create a lot of aggravation.

Want to know more about how the IRS is protecting taxpayers against frauds and scammers?

Follow @IRSnews @IRSenEspanol and click here http://1.usa.gov/1SiQzZr.

Cutting Staff Hours Now Costs More Later

An economist that I heard interviewed on @NPR this week talked about the unforeseen cost to employers of cutting staff hours to part time. They were trying to avoid the cost of medical coverage. But it backfired! The economist described increased costs, turnover, and headaches.

So what happened? Well, it’s pretty logical. Part time positions without benefits don’t attract the qualified people needed to get the job done. Without the right people, things just don’t go right. It’s expensive.

When you buy clothes or a car, it costs more for high quality that lasts longer. Why not take the same approach for hiring your team? It costs more in the long run to “go cheap” and exposes your organization to these four risks:

1. High Error Rate

Unqualified employees make mistakes that are time-consuming and expensive to correct. Assuming the mistakes are detected…what if they’re not? The cost of an unhappy client is incalculable.

2. Inefficiency

Experienced people know what to do and how to it. They assess new situations quickly and accurately. Inexperienced people take more time because they are figuring it out as they go, or need a lot of supervision.

3. High Turnover

Unqualified employees means high turnover. Hiring and training takes time. Vacancies on your team put stress on your other employees. Time and stress don’t show up on your financial statement, but they are real costs you cannot recover.

4. Limited Growth

Employees without the right skills and experience may not even know the basics, let know alone good business practices. Organizations planning to grow need people who can keep up with changing conditions and new methods.

Getting the right people on the team isn’t easy. It’s pretty much impossible if the pay isn’t enough to attract and retain them. Considering the four risks of not investing in the right people will head-off the expensive issues later.

What Price is Right?

The Price Is Right is a fun game show, but deciding the right price to charge your customers is no game. You need to charge enough to make a profit, and not so much that customers are driven from your business to the competition.

Figuring out the right price for your product or service boils down to three elements:

Cost – Competition — Value

Cost

Pricing your product or service involves knowing all of the costs associated with making it happen. Direct costs are usually easy to identify because they are the most obvious – things like manufacturing materials and contract labor.

Less obvious are the indirect costs, such as overhead and marketing. Determine the total cost per service or product by adding the direct and indirect costs and dividing by project hours, production volume, or other measure. Now you know your cost per “unit”.

Competition

Use competitor prices as a benchmark, not your only guide. Knowing your competitors’ prices does not tell you if they are profitable. Seeing if they stay in business at those prices is an indicator but not the whole story.

Does your market have unmet demand? That’s an opportunity to capture more market share through competitive pricing – and great customer service, of course!

Value

Back to that customer service, or whatever your value proposition is. Is your price a little higher because you offer more experience or higher quality? Don’t be deterred from charging more than the competition as long as you can distinguish your product or service from the others.

Should you charge less to gain market share or charge more to highlight your quality? Will you be able to make a profit? Feel confident that you can Price It Right by considering cost, competition, and value.