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The Presidential Election Campaign Fund: useful or useless?

June 8, 2024
Biden-trump-debate-headshots

CNN/Max

In case political news has slipped by you, I’m jealous and sorry to break your bubble. But it’s an extremely consequential election year, so here goes.

The first debate between the presumptive Democratic and Republican presidential candidates is set for June 27. Social media is abuzz — and aghast and, too often, appalling — with political scoops, insights, and just plain wrong info 24/7. And for all the old-school voters, campaign TV spots are already airing.

Meanwhile, both President Joe Biden and Donald J. Trump continue to raise money to pay for, among other things, those pricey television ads.

While both the Biden-Kamala Harris and Trump-??? camps appreciate smaller donations from individuals, it’s the big dollars that are the main political prize.

Big business, big campaign donations: How to fund political campaigns, especially those for the commander in chief, has long been a thorny issue.

The first campaign finance law, the Tillman Act, became law in 1907 and is still on the books, technically prohibiting monetary contributions to federal candidates by corporations and nationally chartered, i.e., interstate, banks. But surprise, surprise, its weak enforcement provisions have allowed businesses and corporations to find loopholes in the law.

Then came Jan. 21, 2010, and the decision by the Supreme Court of the United States (SCOTUS) in Citizens United v. Federal Election Commission. It allows corporations, including certain nonprofit ones, to use their general treasury funds for political advertisements that overtly call for the election or defeat of candidates.

Or, as some have dubbed it, the SCOTUS' "Corporations Are People, Too"  ruling.

Individual voter $ support: Then there’s the school of thought that the actual people who vote, not companies, should fund political campaigns. Various approaches to accomplish this have been explored over the years. Some have even been tried.

The Presidential Election Campaign Fund (PECF) is one of the ways to encourage individual involvement in paying for, as the name says, presidential campaigns. It’s been amended since its enactment in 1966. One of those changes appeared in 1973, when taxpayers got their first opportunity to direct tax dollars to the PECF.

Every filing season since then, when taxpayers fill out their annual income tax returns they are asked if they want to designate money to the fund. In the beginning, the amount was $1 per person. In 1994, the PECF checkoff box amount was increased to $3.

As the excerpt below from this year’s Form 1040 shows, with the campaign fund box highlighted, that’s $3 per taxpayer. So a married jointly filing couple could contribute a total of $6 to the campaign fund. Whoopee!

Form 1040 TY 2023_Presidential Campaign Fund box highlighted

See more tax forms and more about them at Tax Forms 2024.

 

Has the PECF outlived its purpose? Realistically, there’s no way that individual presidential financial support will ever supplant, or even threaten, corporate contributions.

The most ever designated by taxpayers was $71,316,995 in 1994, the tax filing year the possible per-filer amount tripled, according to Federal Election Commission (FEC) data. The dollar amounts have been decreasing each year since.

In 2023, the FEC tally shows taxpayers designated $21,871,573 to the PECF. Through this May, the amount was $17,596,203.

Why such lack of voter/taxpayer interest in supporting the election fund? How much time have you got?

Some of the most common short answers are —

  • a general lack of understanding of the PECF’s goals and operation;
  • the erroneous belief that donations increase will increase filers’ tax liability or reduce their refund amount, despite the statement in the checkoff box that it will have no effect; and
  • general apathy toward the U.S. political system.

Ways to improve the PECF: All of this presidential campaign finance leads us to this weekend’s Saturday Shout Out, a recent TaxVox item asking, What’s To Become Of The Presidential Election Campaign Fund?

“I was proud to contribute to a fund that might limit the influence of money in presidential elections,” writes Renu Zaretsky, a writer for the Washington, D.C.-based Urban-Brookings Tax Policy Center, in her blog post.

This filing season, though, Zaretsky says that she, her spouse, and most of the friends she asked about the public funding option decided not to check the Form 1040 PECF box.

As is the reason for the weekend shout out, I’ll let you read Zaretsky’s piece, in which she explains her no-PECF decision, at your leisure.

There you'll also find her thoughts on how the fund could be changed to be more appealing to voters, as well as to be more effective in providing public election funding.

You also might find these items of interest:

 

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It’s over! With October’s extended filing deadline behind us, it is now time to focus on year-end moves to reduce your 2026 tax bill. 

You’ll find ways to do just that on the Tax Tips page (see the More Tax Posts drop-down menu at the top of the blog), as well as the separate tax tip pages for each month, notably October through December. If you’re on the Tax Tips page, you’ll find a monthly list at the end of this column. If you’re on another blog page, you can head straight to the October tips; at the bottom of that tips page you’ll find links to all the other 11 months’ collections of tax advice.

Not to spoil what you’ll find in that tax advice, but it does cover such things as tax deductions for charitable donations, investment moves that could reduce tax due, and ways to max out your tax-favored retirement savings. 

Finally, as the year winds down, things get hectic. There are lots of other things to occupy our time, like the much more fun upcoming holidays. But don’t lose sight of taxes, since timing is key. To be of use, most tax moves must be made by the end of the tax year. That’s Thursday, Dec. 31, which also is the last business day of the year. 

So that you don’t miss that final tax year deadline, also keep an eye on the countdown clock below. It will keep you on top of just how much time is left to make important, tax-saving moves. (Note: I’m in the Central Time Zone, so adjust accordingly for where you live.)

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