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Tax-Exempt Dollars Going to Illinois Political Campaigns
In investigating campaign contributions to the 17th Ward Democratic Organization, the Better Government Association discovered numerous donations from what appeared to be 501(c)(3) tax-exempt organizations. Upon further analysis, the BGA found more than 400 contributions from such organizations that have been given in Illinois since 1999. Under IRS tax law, tax-exempt organizations are prohibited from engaging in most political activity, including contributing to candidates or party campaign committees. There is no law that prevents candidates and campaign committees from taking these contributions.
The Chicago Sun-Times and BGA partnered in releasing this information. While investigating further, Sun-Times reporters Chris Fusco and Ben Fischer found that some churches and organizations were unclear on the provisions of the tax code. Several groups bought tickets for dinners, golf tournaments, or other events which were actually fundraisers for campaigns, and therefore a violation of the law, according to the IRS.
As a result of this investigation, several campaign committees will return contributions they received from tax-exempt groups and will take steps to ensure the practice ends.
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