political action committee

In the United States, a political action committee (PAC) is a tax-exempt 527 organization that pools campaign contributions from members and donates those funds to campaigns for or against candidates, ballot initiatives, or legislation. The legal term PAC was created in pursuit of campaign finance reform in the United States. Democracies of other countries use different terms for the units of campaign spending or spending on political competition (see political finance). At the U.S. federal level, an organization becomes a PAC when it receives or spends more than $1,000 for the purpose of influencing a federal election, and registers with the Federal Election Commission (FEC), according to the Federal Election Campaign Act as amended by the Bipartisan Campaign Reform Act of 2002 (also known as the McCain–Feingold Act). At the state level, an organization becomes a PAC according to the state's election laws. Contributions to PACs from corporate or labor union treasuries are illegal, though these entities may sponsor a PAC and provide financial support for its administration and fundraising. Union-affiliated PACs may solicit contributions only from union members. Independent PACs may solicit contributions from the general public and must pay their own costs from those funds. Overview Federal multi-candidate PACs may contribute to candidates as follows: $5,000 to a candidate or candidate committee for each election (primary and general elections count as separate elections); $15,000 to a political party per year; and $5,000 to another PAC per year. PACs may make unlimited expenditures independently of a candidate or political party In its 2010 case Citizens United v. FEC, the Supreme Court of the United States overturned sections of the Campaign Reform Act of 2002 (also known as the McCain–Feingold Act) that had prohibited corporate and union political independent expenditures in political campaigns. Citizens United declared it was unconstitutional to prohibit corporations and unions from spending from their general treasuries to promote candidates or from contributing to PACs. It left intact these laws' prohibitions on corporations or unions contributing directly to a candidate or candidate committee.