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Prohibited sources of contributions

The Federal Election Campaign Act prohibits contributions from certain sources made in connection with or for the purpose of influencing federal elections. The prohibitions apply to contributions received and made by political committees.

Prohibited sources of contributions are outlined in the Commission's contributions brochure.

In-kind contributions

An in-kind contribution is a contribution of goods, services or property offered free or at less than the usual and normal charge. The term also includes things of value that can be sold or that appreciate in value, and payments made on behalf of, but not directly to, candidates and political committees (except for independent expenditures or non-coordinated communications).

The value of an in-kind contribution (the usual and normal charge or fair market value) counts against the contribution limit and must be reported by the recipient committee. When determining whether to itemize an in-kind contribution, a committee should treat it the same as a monetary contribution. The only difference is that the amount of an in-kind contribution must also be included in the committee’s total operating expenditures in order to avoid inflating cash on hand. An in-kind contribution must be itemized as an operating expenditure on Schedule B of the committee’s FEC report only if it has to be itemized as a contribution on Schedule A of the same report.  When looking for in-kind contributions on a report, you will see a memo field with the letter “X” and the word “In-Kind” in the Purpose of Disbursement field of Schedule B.

Earmarked vs. bundled contributions

An earmarked contribution is a contribution that the contributor directs (either orally or in writing) to a clearly identified candidate or authorized committee through an intermediary or conduit. Earmarking may take the form of a designation, instruction or encumbrance, and it may be direct or indirect, express or implied.

A bundled contribution under the Honest Leadership and Open Government Act of 2007 means a contribution (subject to the applicable threshold) that is: “(i) forwarded from the contributor or contributors to the recipient by a lobbyist / registrant; or (ii) received by the committee from a contributor or contributors, but credited by the committee or candidate involved (or, in the case of a leadership PAC, by the candidate associated with the PAC) to the person through records, designations, or other means of recognizing that a certain amount of money has been raised by the person.”