Are political contributions tax deductible?

Updated for tax year 2017.

As this year’s presidential election season hums along, campaign contribution totals have well exceeded 800 million dollars – and they continue to rise. With this level of fundraising, one question is sure to come to mind – are political contributions tax deductible?

The short answer? No.

Most political contributions, whether local, regional or national, are not tax deductible and haven’t been for years. So, if you happen to be one of the many people donating to political candidates’ campaign funds, don’t expect to deduct any of those contributions on your next tax return.

And the same goes for a business return. In most cases, political contributions are not considered a viable business expense and therefore are nondeductible.

While writing checks to a political party may not help your tax bill, there are ways to financially support a cause you believe in and still take a tax benefit in the process. You just have to find a charity that qualifies for tax-deductible contributions.

Tax-qualified charities aren’t allowed to lobby or give money to a candidate, political party or political action committee (PAC). However, under the banner of “education,” they can help persuade people about pertinent issues, which could have an impact on the final election outcome.

How do I know if donations to a charity are tax deductible?

Only contributions to 501(c)(3) organizations are tax deductible. These nonprofits have been designated as charitable organizations by the IRS.

To help clarify any confusion, specific details regarding the type of IRS organization and whether donations are tax-deductible should be clearly stated by the charity.

If you’re still in doubt the IRS has an online tool that can help. The Exempt Organizations Select Check search tool lets you search for organizations and find certain information regarding their status.

Be aware that not all organizations are listed and some use “doing business as” names, meaning they operate their business under a name that’s different than their legal, registered name. In this case, searching by their legal name may not show up in the database.

What about other nonprofits that promote causes I believe in?

If you want to donate to most social welfare nonprofits, otherwise known as 501(c)(4) organizations in the tax world, you’ll have to do so without receiving a tax benefit.

However, there are a couple exceptions.

Donations to veterans’ organizations with 90 percent war vet membership and volunteer fire departments can be deducted on your tax return.

 

About Sally Herigstad

Sally Herigstad is a certified public accountant and personal finance columnist and author of Help! I Can't Pay My Bills, Surviving a Financial Crisis (St. Martin's Griffin). She writes regularly at CreditCards.com, Bankrate.com, Interest.com, RedPlum, and MSN Money. She is an experienced speaker and a member of Toastmasters International. Follow Sally on Twitter.

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