Are super PACS legal, or are super PACs bad, are common questions America is asking. The short answer is Super PACs are both illegal and bad for democracy.
This said, Super PACs are good in a few ways. Some super PACs help prevent contributors from trying to remain anonymous. Some super PACs accurately answer the question are super PAC donations tax deductible?
Define super PACs
A super PAC is a group that wants money. They claim there is no individual campaign contribution limit. Campaign contributions go in, covers salaries and rent, and goes out to buy campaign ads. Super PAC operators tend to buy from firms that give kick-backs.
If this sounds questionable to you, you are not alone. There is a lawsuit against super PACs.
Are super PACs legal or illegal?
The majority of the media will claim unlimited campaign contributions are legal if operators wave a magic wand, mumble a few words, and toss salt over their left shoulders. The media has an incentive since they get most of the super PAC money. Even NPR runs an alarming number of "sponsor" segments paid for by super PACs. Over at Wikipedia you will see very little mention since some editors there want the money flow to continue for their parties.
Super PACs tend to point out they are exploiting a loop hole in the law that is "valid". However, they cannot point to any Judges who say it is okay to give unlimited individual funds with a prior understanding.
The lawsuit points to a January 31, 2012 U.S. Court ruling that determined that if the intent of the contributor was their funds be used for electioneering, that it is subject "regulation". Regulation according to the lawsuit means disclosure and limit. No court has removed the individual contribution limits as listed by the FEC in this table.
Do super PACs have to disclose donors?
YES. Super PACS must disclose contributors is the short answer. Super PACs are generally good in this regard since they do collect and report information to the Federal Election Commission (FEC).
However,
Some super PACs may intentionally help keep donors anonymous. Think of the question that voters have the most:
Who really paid for the message I just saw?
If the disclaimer is only "
Paid for by a Super PAC" that doesn't tell the voter much. If on-line detailed reports only show data already submitted, voters may head to the polls and still be in the dark. Hence the term "
dark money".
Alternately in certain cases super PACs launder money using a front organization to accept clean money in the door. They then bundle it, and pass out dirty money minus the original donor names. Tracking the money trail may take years of court battles.
So in these regards, super PACs can bad for democracy.
Are super PAC donations tax deductible?
In general, NO, super PAC donations are NOT tax deductible. Here is a quote from the IRS:
Political ContributionsYou cannot deduct contributions made to a political candidate, a campaign committee, or a newsletter fund. Advertisements in convention bulletins and admissions to dinners or programs that benefit a political party or political candidate are not deductible.
The confusion comes from the fact that super PACs themselves are usually non-profits. They don't get taxed on money you give them. Most of us are used to taking deductions on any organization that calls itself a non-profit and have no idea there are different types.
CAUTION:
Be careful about contributions to organizations that claim you can take a tax deduction. You should make sure they are not really involved with campaigning. Watch for special interest groups that advocate for or against a cause. Gifts to groups for and against same-sex marriages, gay rights, abortion, liberal and conservative causes are usually not tax deductible.
There have been cases where donors who took tax deductions received letters from the IRS that disallowed the deduction owing to the group's political activities.
Philip B. Maise