Policy statement on payroll deduction recordkeeping

On July 7, 2006, the Commission published a Statement of Policy to announce that retaining signed payroll deduction authorization forms (PDAs) is not the only way committees can satisfy the recordkeeping requirements for the resulting contributions. 71 FR 38513. The statement explains that other evidence may be acceptable, including records of the transmittal of funds from employers or collecting agents, such as spreadsheets, computerized records, wire transfer records, or other written or electronic records.

The Commission still considers the retention of PDAs to be a good recordkeeping practice and in some cases PDAs may serve as the best documentation of an authorized deduction.

Background

Corporations, labor organizations, and trade associations are prohibited from making contributions in connection with a federal election, but may establish and support a separate segregated fund (SSF). See 11 CFR 144.2(f). The sponsoring organization may— among other things—use a payroll deduction system to collect and forward contributions from members of its restricted class to the SSF. 11 CFR 114.2(f)(4)(i). The SSF must maintain records allowing the Commission to determine that the source and amount of contributions are accurately reported. See 11 CFR 104.14(b)(1) and 104.8(b). In the past, the Commission has required original signed PDAs as proof that an SSF had fulfilled its recordkeeping requirements for payroll deductions under 11 CFR 104.14(b)(1).

Evidence of recordkeeping

As a result of the policy statement, the Commission no longer requires original PDAs as the sole proof that a committee has fulfilled its recordkeeping requirements with respect to payroll contributions. The Commission continues to encourage committees to retain original PDAs, but will now accept other forms of documentation including spreadsheets, wire transfer records, or other electronic or written records.