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News > AFFTC Legal Office explains the Presidential Election Campaign Fund
AFFTC Legal Office explains the Presidential Election Campaign Fund

Posted 2/10/2010   Updated 2/18/2010 Email story   Print story


by Capt. Melissa Horton
Air Force Flight Test Center Legal Office

2/10/2010 - EDWARDS AIR FORCE BASE, Calif. -- Each year, millions of people misinterpret the question regarding campaign funds on their 1040 federal tax returns. Most taxpayers check the "no" box because of the mistaken belief that they are being asked to donate their money to the Presidential Election Campaign Fund.

The concept of the Presidential Election Campaign Fund started in the early 1900s when public funding of presidential elections was proposed as a way of reducing corruption and private funding in elections. However, it was not until the 1950s that it became a popular idea. After several failed attempts at a bill, The Revenue Act of 1971 was finally passed and established what is now known as the Presidential Election Campaign Fund, which is a separate U.S. Treasury account that funds general election campaigns of candidates who meet certain criteria. At that time, The Federal Election Campaign Act of 1971 limited candidates' own campaign contributions to $50,000. In the beginning, many predicted that public funding of elections would encourage candidates outside the major political parties to run a viable campaign for president, but this has not been the case.

In tax year 1972, a voluntary one-dollar check-off on federal tax returns began as a way to build presidential campaign financing on a large base of small donors. More recently, in tax year 1993, the check-off was increased to $3 on single returns and $6 on joint returns.

Since 1976, public funds have financed every presidential election to some extent. Despite this fact, few taxpayers actually choose to designate money to the Fund. At its peak in 1980, 28.7 percent of taxpayers chose to designate money to the fund; however, that amount drastically decreased to only 8.3 percent in tax year 2007.

According to the Congressional Research Service, taxpayer participation is likely low because many people misunderstand that the check-off does not increase his or her tax bill. Instead, it simply designates money in the U.S. Treasury for the Presidential Election Campaign Fund. So, rather than a taxpayer's personal funds being donated when he or she affirmatively checks this option, U.S. Treasury dollars are designated to go toward the Fund.

Since the inception of the check-off, over a billion dollars has been distributed to about a hundred primary election presidential candidates. Even though not many taxpayers choose to check off the box on their federal tax returns designating Treasury funds, since 1976, almost 90 percent of candidates have accepted funds for the primary election and all major party nominees, except one--President Barack Obama-- accepted public funds in the general election.

In recent years, there have been attempts in Congress to end the check-off system and there is widespread agreement that the public funding of presidential campaigns needs to be addressed by Congress. Currently, Federal Election Commission administers and enforces the federal campaign finance laws.

Until and unless the laws are changed, taxpayers will continue to be asked if they would like to designate $3 to the Presidential Election Fund. But the educated taxpayers will understand the question and choose the option that best suits their opinion on the issue.

For more information, visit www.fec.gov.

(Editors note: This article was adjusted February 18, 2010 to correct an error in fact.)

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