CCAH Political Commitee
Quick Facts: What is a PAC?
A PAC is a separate segregated bank account, exempt from income tax for the purpose of supporting or opposing candidates for elective public office. Segregating the PAC funds from an association’s general fund protects the association from possible tax liability, protects its tax-exempt status, and prevents intrusive disclosure of deposits and payments from its general fund for purposes other than political.
Donate to our Political Action Committee
CCAH’s PAC enables us to drive legislative and advocacy efforts that support the development of affordable housing in California.
Who can give (and cannot give) to a PAC?
Who can’t give:
- Public Agencies
- Foreign nationals – companies and individuals
- 501(c)(3) organizations
- Lobbyists, if the lobbyist participates in the PAC’s decision to make contributions to candidates
- Businesses and their “key personnel” that seek or have contracts to manage public retirement funds
Who can give:
- Individuals (including those with a green card)
- Businesses (including US subsidiaries of foreign businesses) such as corporations, partnerships,
- LLCs*, sole proprietors
- Associations, subject to tax considerations
- Other PACs
* LLCs – new FPPC Form 409 required starting in 2022 to disclose 10%+ owners and capital contributors of $10,000 or more
Nonprofits that receive public funding but aren’t public agencies:
- may contribute to a PAC from non-public funding sources
- recommend segregating public funds from non-public funds, and pay for any PAC or campaign activity solely from the non-public funds account; required if entity qualifies as a “publicly funded nonprofit” – see reporting discussion below
- consult a tax advisor regarding Internal Revenue Code section 527(f) and 6033(e) taxes
What can PAC dollars be used for?
- Contributions to state and local candidates
- Contributions to political parties
- Contributions to other PACs
- Contributions to caucuses, charities, civic organizations
- Independent expenditures
- Polling, Research
- PAC’s fundraising and administrative costs
Ballot measures and other non-candidate related
expenditures: Because a candidate PAC is tax exempt
under Section 527, that means it doesn’t pay income tax on
its revenue provided it operates primarily to support or
oppose candidates – ballot measures are not candidates,
and certain charitable and civic donations may also be
difficult to tie to any “candidate” nexus. Such expenditures
can be made but should be nominal compared to overall
spending by the PAC. If ballot measure expenditures need
to become a larger focus, a dedicated “issues committee”
should be set up, ideally using the association’s existing tax
exemption (though a new tax-exempt entity can be
established)