Will Your Name Be Disclosed If You Give Money?

In five minutes or less, you can understand what kinds of organizations have to report the names of donors and what kinds don’t. Here’s the quick run down.

Organizations That Don’t Have to Disclose Their Donors:

Private Organizations and Businesses –  Generally speaking, the internal matters (names of donors, members, customers, and investors) of private organizations and businesses aren’t subject to public disclosure. However, if a business chooses to be publicly listed on a stock exchange, it might be legally required to report this information. To force disclosure of these names, there must exist some legal exception that could pass constitutional scrutiny.

Corporations – Many, but not all, types of corporations are prohibited from giving money directly to, or coordinating with, candidates. However, since the Citizens United decision in 2010, the courts have protected the rights of private organizations, including corporations, to engage in independent speech related to both candidates and political issues. For example, in Texas, if a business decides to spend money on a mailing about some ballot issue or candidate, it doesn’t have to disclose the identities of its investors or customers. In fact, any attempt to force the disclosure of these names could be viewed as unconstitutional if it is seen as having a “chilling effect” on free speech.

Non-profit organizations –  Non-profits, including 501c3’s and 501c4’s, are treated very similarly to private corporations, though there are some additional federal reporting requirements. The IRS requires non-profit organizations to file a form 990, which lists contributors who have given more than $5000 to the organization in a fiscal year. By law, the IRS is required to keep these names strictly confidential and to use this information only for internal IRS purposes. Recently, leaks by politically motivated individuals at the IRS have brought court scrutiny to this requirement, and its continued viability is in doubt. At the state level in Texas, there are no current laws requiring non-profit organizations to disclose their donors. If the state were to seek such requirements, it would face an uphill legal battle to show the requirements are constitutional.

The Rationale for Non-Disclosure: Constitutional Rights and Protection from Harassment

Courts have acknowledged that reporting and disclosure requirements can unconstitutionally interfere with the First Amendment rights of individuals and groups to freedom of speech and freedom of assembly.

Similarly, courts have found preventing the disclosure of donor and member names can also prevent harassment. In 1958, in NAACP v. Alabama, the U.S. Supreme Court ruled that the State of Alabama could not force the civil rights organization to disclose its member or donor lists lest those individuals be subject to violence. Some people have tried to suggest this only applies to organizations facing terroristic threats, such as civil rights organizations in the 1950s, but the Texas Supreme Court extended the NAACP decision in 1998 in In Re: Bay Area Citizens Against Lawsuit Abuse. In that case, the Court acknowledged that the identities of donors to private organizations must be constitutionally protected against forced disclosure if the disclosure could have any chilling effect on membership, such as through boycotts or harassment.

Organizations That Do Have to Disclose Their Donors:

Purely political organizations, such as candidates’ campaigns, special purpose political committees, and general purpose political committees, are required by relevant state and federal laws to disclose the identities of contributors giving $50 or more as well as other information, such as the dates of all expenditures and payees. These laws are justified on the grounds that these organizations, unlike most private corporations, are legally allowed — like individuals and partnerships — to give money directly to candidates.

The Rationale for Disclosure: Preventing Vote-Buying

The courts have determined that donor disclosure is required in these cases “in order to prevent quid pro quo corruption or the appearance thereof,”  which is deemed a compelling state interest. In other words, campaigns must disclose their donors to prevent donors from buying votes. State-level campaigns and committees must file reports with the Texas Ethics Commission or a local filing authority. Federal campaigns and committees are required to file their reports with the Federal Election Commission.

The Bottom Line:

Candidates’ campaigns are required to disclose their contributors and so are certain kinds of political committees set up to give donations to candidates. Most other private organizations and individuals are not required to disclose the identities of donors and investors unless some specific, constitutionally-justified statute requires it. So, will your name be disclosed? If you donate to a political 501c3 or 501c4 it won’t. If you donate directly to a candidate or a PAC, yes, your name will be reported.

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