Raising money and managing expenses is an critical part of the election process. Opening a campaign bank account is a first step in establishing a viable political campaign.
A bank checking account serves several purposes. It allows you to accept political donations and contributions from supporters, and to make campaign purchases. To do all this, you will want to know how to open a bank account for a political campaign.
- Open your political campaign checking account as early as possible. Campaign finance laws in many states require that a campaign bank account be established in order to legally deposit political donations. The earlier you have an account, the sooner you can start raising seed money.
- Prior to opening a campaign bank account, you may need to establish a political campaign committee with your local county Board of Elections. The name you use for your campaign committee is the name you will use to open the bank account. The bank will require committee paperwork along with personal identification.
- Open an interest-free checking account rather than an interest-bearing savings account. Any interest earned on a campaign bank account must be reported in your finance reports. Considering how little banks pay in interest, the small amount of money to be gained is hardly worth the additional effort required by your committee treasurer to report.
- A candidate’s personal funds can be used for campaign purchases before a campaign bank account is established. Those purchases are generally treated as an in-kind donation or as a personal loan. Once the campaign is underway, the treasurer should handle the political funds and keep track of income and expenditures. For larger campaigns, it may be a good idea to hire an accountant.
- You should keep detailed records of every account transaction for financial filing requirements. Keep statements, records and receipts in a safe place. They should be held indefinitely in case questions later arise as to your campaign finances. Whatever you do, do not co-mingle funds between accounts.
These guidelines also apply for a political party bank account and political action committee bank accounts. If you accept donations or hold fundraisers, you will need a place to deposit your money. Most traditional banks, savings and loan association or credit unions can handle accounts for political campaigns and fundraising needs. You’ll want to check with them for eligibility first, of course.
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Federal campaigns and committees require an Employer Identification Number (EIN). This nine-digit number is issued by the IRS for identification purposes. It is similar to EIN numbers assigned to businesses and corporations. Never open an account in the name of an individual or with an individual’s Social Security Number.
If you are starting a political action committee (PAC) and opening a checking account, the PAC must be first approved by the Federal Election Commission (FEC). Under these requirements, you will need an address for the PAC and a designated treasurer to handle the funds. There are additional compliance guidelines for any fund transfers that you make.
One question that tends to come up is whether a candidate needs to establish separate bank accounts for both the primary and general election. This can depend on whether your contribution limits apply per election, where the fundraising for the primary election and fundraising for the general election are separate. If so, a candidate may need to establish separate bank accounts for each election.
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