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house Bill H.R. 918

Should PACs be Required to Disclose Their Major Donors’ Identifying Information?

Argument in favor

The influence of so-called “dark money” in U.S. elections is significant and harmful to our democracy. Unmasking the wealthy donors who make political donations to PACs to influence elections is needed, especially in an increasingly partisan era.

SeanK's Opinion
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02/22/2019
Pacs should be illegal but if we're going to have them then we need to at least know who sponsors our politicians.
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KevinRosa's Opinion
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02/22/2019
Money is not speech. Period. Dark money and corruption have no place in a democratic society. We should have free and fair elections and have public financing of elections.
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burrkitty's Opinion
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02/22/2019
Transparency transparency transparency. WE THE PEOPLE need to know who is buying our government. They shouldn’t be legal at all, but until we get serious campaign finance reform laws we have to deal with this “legal corruption”
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Argument opposed

The Supreme Court already ruled against forcing nonprofits — even political ones — to disclose their donors as it may have a chilling effect on free speech. Additionally, since PAC donations aren’t tax-deductible, donor information isn’t needed for the IRS to do its job as the U.S.’ tax authority.

JTJ's Opinion
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02/23/2019
Absolutely not. Individuals who donate $5k are not “dark money” donors. This is a huge violation of people’s privacy and speech rights.
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Ellen's Opinion
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02/22/2019
Public disclosure could be dangerous to donors from mentally unstable folks whom disagree with recipients.
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tituswife's Opinion
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02/22/2019
This would infringe our #1stAmendment rights.
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bill Progress


  • Not enacted
    The President has not signed this bill
  • The senate has not voted
  • The house has not voted
      house Committees
      Committee on Ways and Means
    IntroducedJanuary 30th, 2019

What is House Bill H.R. 918?

This bill — the Spotlight Act — would reverse a recent Treasury Department decision exempting 501(c)4 organizations from disclosing their donors’ names. It would amend the tax code to require 501(c) charitable organizations, including 501(c)4, (c)5, and (c)6 organizations, to include the names and addresses of donors who contribute $5,000 or more on their annual tax returns with the Internal Revenue Service (IRS). It’d also require these organizations to make their donors’ information available to the public.

Impact

Nonprofit donors; 501(c)4 charitable organizations; 501(c)5 charitable organizations; 501(c)6 charitable organizations; Treasury Department; Internal Revenue Service; and the tax code.

Cost of House Bill H.R. 918

A CBO cost estimate is unavailable.

More Information

In-DepthRep. David Price (D-NC) reintroduced this bill from the 115th Congress to reverse the Treasury Department’s recent decision allowing politically active non-profit organizations to avoid disclosing certain donor information to the IRS and compel these organizations to disclose major donors’ names to the public:

“The Trump administration’s decision to allow politically active organizations to obscure millions in dark campaign money further weakens our already failing campaign finance system. At a time when our elections are plagued by unlimited corporate spending, anonymous donors, and illegal foreign meddling, this action provides a mask to special interests and bad actors  while diminishing the power of voters.”

House Speaker Nancy Pelosi (D-CA) adds:

“Our Founders pledged their lives, their liberty and their sacred honor to build a government of the many, not of the money. Congressman David Price and the House Democracy Reform Task Force have been champions in the fight to bring transparency and accountability to our campaign finance laws, and restore the full promise of our democracy.  By joining the Senate to overturn this dangerous IRS guidance, Democrats are taking action to strengthen the voices of the American people and end the self-enrichment, dark money and special interests that threaten our democratic institutions. Guided by the vision and values of our Members and the priorities of the American people, the new Democratic Majority introduced H.R. 1, the For The People Act, to restore integrity in Washington and ensure that our government works for the public interest, not the special interests.”

Democracy 21 supports this bill. Its president, Fred Wertheimer, says:

“Democracy 21 strongly urges Representatives to support the CRA disapproval resolution sponsored by Representative David Price to invalidate the irresponsible Treasury Department rule that eliminates the existing requirement for nonprofit groups to disclose their donors to the IRS. Under existing law foreign governments can contribute unlimited amounts to nonprofit groups that spend money to influence elections. The elimination of the requirement for these contributions to be disclosed to the IRS opens the door for foreign interests to illegally launder huge sums through nonprofit groups to influence our elections without the government being able to know it is going on. If the new Treasury rule is not eliminated, a massive dark money loophole will be opened in our laws for foreign individuals, foreign corporations and foreign corporations to illegally spend unlimited amounts of money to influence our elections. Any Representative who opposes the Price the disapproval resolution will be supporting a dangerous dark money loophole for illegal foreign money to be secretly laundered into our elections.”

In September 2018, the Ninth Circuit Court ruled that the state of California could collect information about major donors to 501(c)4 charitable organizations, including PACs. However, the Ninth Circuit’s ruling did not make this information public, and California Attorney General Xavier Becerra’s office would only make it public in “very limited circumstances.”

However, the Supreme Court has said that forcing charitable groups, even those involved in politics, to disclose their donors’ names could chill free speech. Ray Cordato, a resident scholar at the John Locke Foundation who has defended anonymous speech and anonymous donations as essential to avoiding harassment and retaliation and preserving free speech and political dialogue, concurs, arguing:

“It’s clear what the purpose of this [bill] is. It’s a way of scaring people into not giving money to certain kinds of organizations. The fact of the matter is this is the kind of thing that was used against Martin Luther King and civil rights organizations [by racists seeking the names of their contributors]. Now it is [by] the Left, and everyone knows now they are all about intimidation.”

When announcing the Treasury Department’s July 2018 decision to exempt 501(c)4 organizations from disclosing their donor information to the IRS, Treasury Secretary Steve Mnuchin argued that the IRS doesn’t need these organizations’ donor information to do its job:

“Americans shouldn’t be required to send the IRS information that it doesn’t need to effectively enforce our tax laws, and the IRS simply does not need tax returns with donor names and addresses to do its job in this area. It is important to emphasize that this change will in no way limit transparency. The same information about tax-exempt organizations that was previously available to the public will continue to be available, while private taxpayer information will be better protected. The IRS’s new policy for certain tax-exempt organizations will make our tax system simpler and less susceptible to abuse.”

This bill has nine cosponsors, all of whom are Democrats, in the current session of Congress. Last Congress, it had the support of 13 cosponsors, all of whom were Democrats. End Citizens United, Common Cause, and Democracy 21 support this bill.

A Senate version of this bill has been reintroduced by Sens. Ron Wyden (D-OR) and Jon Tester (D-MT). Last Congress, Sen. Tester introduced this bill in the Senate with the support of 28 cosponsors, all of whom were Democrats.

In addition to this bill, Sens. Tester and Wyden introduced a Congressional Review Act (CRA) resolution to reverse the Treasury Dept.’s decision in September. That resolution — which had the support of 41 cosponsors, including 39 Democrats and two Independents — passed the Senate by a 50-49 vote, but was never taken up for a vote in the House.


Of NoteIn July 2018, the Treasury Department announced that it would begin allowing politically active 501(c)4 charitable organizations to shield some donor information from the IRS. 501(c)3 charitable organizations, whose donors can claim tax deductions from their contributions, are still required to disclose information about their donors to the IRS. 501(c)4 groups, whose donors generally can’t claim tax deductions, are exempted from sending donor information to the IRS.

Those who favor requiring nonprofits that engage in political activity to disclose their donor information argue that a lack of disclosure allows anonymous donors to spend huge sums of unchecked money to rig the system in their own favor.

During the 2018 cycle, dark money groups reported nearly $148 million in outside spending, not including money spent toward so-called issue ads aired before election season and other undisclosed political efforts, to the FEC. These groups also contributed over $176 million to super PACs in 2018.


Media:

Summary by Lorelei Yang

(Photo Credit: iStock.com / D-Keine)

AKA

Spotlight Act

Official Title

To amend the Internal Revenue Code of 1986 to require certain tax-exempt organizations to include on annual returns the names and addresses of substantial contributors, and for other purposes.

    Pacs should be illegal but if we're going to have them then we need to at least know who sponsors our politicians.
    Like (195)
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    Absolutely not. Individuals who donate $5k are not “dark money” donors. This is a huge violation of people’s privacy and speech rights.
    Like (20)
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    Share
    Money is not speech. Period. Dark money and corruption have no place in a democratic society. We should have free and fair elections and have public financing of elections.
    Like (153)
    Follow
    Share
    Transparency transparency transparency. WE THE PEOPLE need to know who is buying our government. They shouldn’t be legal at all, but until we get serious campaign finance reform laws we have to deal with this “legal corruption”
    Like (95)
    Follow
    Share
    We should know who donates to campaigns. PAC s should be illegal.
    Like (65)
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    Free speech is guaranteed. Anonymous speech is NOT. People and corporations need to be responsible for their speech, including their political donations.
    Like (51)
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    Is transparency a nonexistent thing? Why would we shroud anything, especially money in secrecy? How can we say this is for the people by the people, but um... Not to be known by the people or from which people. Not okay. Disclosure is imperative. Stop hiding behind your donors dirty money.
    Like (42)
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    If you believe in a cause so greatly then you shouldn’t be afraid to have your name made public!
    Like (38)
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    There should be no such things as PACs. And they certainly should NOT be tax exempt! They are NOT charitable organizations. I call bullshit on that and the PACs. They buy votes! That is their sole purpose! We need big changes and we need them now. No more of this crap in 2020. WE MUST RISE UP! THIS HAS TO STOP! Who in their right mind would call donating money free speech? Can money open its mouth and words come out? You crooked assholes need to go. Can't be soon enough! And Barr, will your son being an advisor to the President not influence your decision on the disclosure of the Mueller report? Yeah, right, it won't! We'll see. Won't we?
    Like (28)
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    Yes disclosure must be required from all donors to federal level politicians.
    Like (28)
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    Transparency, Transparency, Transparency! Dark monies indeed. The list must be made public. If you’re willing to accept the money to back your campaign and your causes, your constituency deserves to know who lines your pockets.
    Like (26)
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    We have a right to know who you work for.
    Like (25)
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    Publicly funded elections are the only way to ensure fair elections.
    Like (23)
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    Yes, please. We need transparency in our elections. Even if we can’t enact limits on donations to PACs, which is ideal, we should at least know who is funding them.
    Like (19)
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    It should also include a statement that claims they are not a front for someone else or a shell Corp. making the donation prosecutable for perjury if they lie.
    Like (17)
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    This has been a long time coming and should be required ASAP.
    Like (17)
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    There is no reason for someone to hide their identity when making a political donation. To be allowed to do so opens the door for foreign and illegal contributions. Silent speech is not the same as free speech. If you want your speech to be heard, have the integrity to claim it as yours and attach your name to your donation.
    Like (16)
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    Anyone who doesn’t want to be identified is probably the kind of entity we should know about
    Like (15)
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    Absolutely. There should be zero anonymity for people paying to influence political causes.
    Like (14)
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    More transparency of funding is always a good thing
    Like (12)
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