Tax News Archive:
Political Organization Report of Contributions and Expenditures
According to the new law signed by Bill Clinton on July 1st, 2000, which amended section 527 of the Internal Revenue Code, any political organization that wants to be treated as a section 527 organization must file form 8871 and Form 8872. Form 8871 is filed to report the status of a political organization as a section 527 organization within 24 hours of its creation. Form 8872 is used by that section 527 organization to report any contributions it receives or any expenditures it makes after July 1st, 2000.
This tax year happens to be an active year for the section 527 organization. Some of them may even have to file pre-election reports with the IRS. According to the IRS website, an election is:
- A general, special, primary, or runoff election for a Federal office,
- A convention or caucus of a political party which has authority to nominate a candidate for Federal office,
- A primary election held for the selection of delegates to a national nominating convention of a political party, or
- A primary election held for the expression of a preference for the nomination of individuals for election to the office of President.
Section 527 organizations that are exempt from filing form 8872:
- An organization that reasonably expects its annual gross receipts to always be less than $25,000,
- A political committee required to report under the Federal Election Campaign Act of 1971 (2 U.S.C. 431 et seq.),
- A tax-exempt organization described in section 501(c) that is treated as having political organization taxable income under section 527(f)(1), or
- A state or local committee of a political party or political committee of a state or local candidate.
(Source: IRS website, www.irs.gov)
Form can also be obtained by calling 1-800-829-3676.
