California Major Donors:
Forms & Compliance
The California Political Reform Act may require you to file campaign disclosure reports. Tuple Legal can help.
The California Political Reform Act is difficult to navigate—which makes staying compliant with it likewise difficult.
By making a contribution to a candidate for office, a PAC, or a political party, you may be required to file campaign disclosure reports. Failure to do so could result in financial penalties—or worse.
Tuple Legal provides legal counsel for California major donors who need help staying legally compliant.
Contact Tuple Legal for a consultation on getting compliant – or, keep reading for an overview of what constitutes a major donor, and a description of legal compliance requirements they face.
What is a Major Donor?
Generally speaking, a major donor is any person, company, or other organization who contributes $10,000 in a calendar year to a state or local political campaign, PAC, political party, or any combination of the three.
(Note: A major donor is not someone who collects money from others for political activity, commonly known as a PAC.)
Examples
Here are two common scenarios in which a person or company becomes a major donor.
Scenario 1: In April, Tiffany made contributions totaling $8,000 to three city council members. In October of the same year, she made another $4,000 contribution to a State Assembly candidate. After making the $4,000 contribution, Tiffany qualifies as a major donor.
Scenario 2: This year, the Rho Corporation made a $55,000 contribution to the “Yes on 2A” ballot measure committee. The Rho Corporation qualifies as a major donor
Have You Received a Notice About Your Political Contribution? Why Was it Sent?
If you have made a contribution of $5,000 or more to a political candidate, a PAC, or a political party in California, you may have received a notice about requirements to report your contributions.
When you make a contribution of that size in California, the recipient of your contribution is required by law to send you the notice you received.
Retaining Tuple Legal helps you avoid the headache of figuring out what – and where – to report your political contributions.
Here is a short list of our services for nonprofits and related organizations engaging in political activism.
Timely Reporting & Filing
Reporting requirements vary based on your nonprofit type, the nature of your political activism, and which campaign finance laws are applicable.
Protect Your Tax-Exempt Status
Once revoked, regaining tax-exempt status is often a lengthy, stressful, expensive process. Tuple helps you stay compliant.
Political Speech Guidelines
Federal tax law doesn’t just regulate how nonprofits spend their money – for example, mere political statements by a 501(c)(3)’s Executive Director can constitute off-limits campaigning.
Training Staff & Board Members
Tuple can help educate your employees, board members, and volunteers about which political activities are permissible vs prohibited. We can also develop your social media & activism policies.
Preparing to Lobby
The rules for lobbying and ballot measures are particularly complex, and the penalties for noncompliance are strict. We’ll help you get started and provide ongoing logistical and legal advice as you grow.
Avoid Reputational Damage
Scrutiny from the Attorney General, IRS, or your opposition can damage your organization’s reputation – and the cause or candidate you’re championing. It can also make it more difficult to attract and retain donors, volunteers, and sponsors.
We can help you make an impact
Schedule a call or send us a note using the link below.
More Frequently Asked Questions
Here’s what major donors ask us the most.
What are the penalties for non-compliance?
Late fees for non-compliance are $10 per day, per contribution. Additional administrative fines may tally up to $5,000 per violation. It is also possible for authorities to bring criminal charges and seek additional monetary penalties for knowing or willful violations. Additionally, any enforcement proceeding by the California Fair Political Practices Commission, a District Attorney, or the California Attorney General would bear additional costs.
No. Your contributions made from your personal funds and from funds of any entity you control are aggregated for purposes of determining your major donor status. Similarly, contributions made by two or more entities whose contributions are directed and controlled by a majority of the same people are aggregated for purposes of determining your major donor status. Two examples follow.
- Example 3: In May, Elise Weintraub made contributions from her personal funds, totaling $8,000 to candidates for county offices. In June, she made a $5,000 contribution to a gubernatorial candidate from her wholly owned business. Because Ms. Weintraub directed and controlled all of the payments, she and her business qualify as a single major donor.
- Example 4: Pear Computer contributed a total of $9,000 to support local school board candidates. Under the direction of Pear Computer, Seed Incubator, Inc., a company in which Pear Computer has greater than 50 percent ownership, contributed $7,000 to support an Attorney General candidate. Because Seed Incubator, Inc. did not act independently, the companies qualify as a single major donor committee.
Your circumstances may be even more complicated. Tuple Legal can help sort it out.
What reports do I have to file?
Depending on when you make a particular contribution and to whom you make it, you may be required to file a “24-Hour Contribution Report” soon after making a contribution.
You will also have to file periodic “Major Donor and Independent Expenditure Committee Campaign Statements.” The timing of these reports also depends on when and to whom you make contributions.
Tuple Legal can help you file these reports, commonly known as Form 497 and Form 461.
Where do I file the reports?
Where you need to file your reports depends on the types of candidates, PACs, and political parties to which you contributed as well as the amounts given. They may need to be filed with the California Secretary of State, a county elections office, or a city clerk’s office—and sometimes the location will change.