Report Title:

Election Campaign Contributions; Income Tax Deductions

 

Description:

Allows registered voters to take an income tax deduction for contributions to candidates seeking election to an office in the district in which the voter resides, regardless of whether the candidate has agreed to abide by campaign spending limits. Reduces paperwork necessary to claim this tax deduction.

 

THE SENATE

S.B. NO.

2981

TWENTY-FIRST LEGISLATURE, 2002

 

STATE OF HAWAII

 


 

A BILL FOR AN ACT

 

RELATING TO ELECTION CAMPAIGN CONTRIBUTIONS.

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

SECTION 1. The purpose of this Act is to allow registered voters to take an income tax deduction for contributions to candidates who are seeking election to an office in the district in which the voter resides, regardless of whether the candidate has voluntarily agreed to abide by statutory campaign spending limits, and to reduce the amount of paperwork necessary to claim this deduction. The intent of this Act is to increase contributions from voters who live in the candidate's district, thereby diluting the effect of special interest money to candidates.

SECTION 2. Section 11-226, Hawaii Revised Statutes, is amended to read as follows:

"11-226 Tax deductions. (a) As a condition of allowing an individual to take a tax deduction for campaign contributions to a candidate pursuant to section 235-7(g)(2), [a] either:

(1) The individual shall be a registered voter who resides in the district in which the candidate is seeking election, regardless of whether the candidate has agreed to abide by the campaign expenditure limits as set forth in section 11-209; or

(2) The candidate shall have filed an affidavit with the commission prior to or simultaneous with the filing of the candidate's organizational report stating that the candidate shall not exceed the expenditure limit for the candidate's respective office as set forth in section 11-209.

(b) The affidavit shall remain effective until the termination of the central committee of the candidate or the opening of filing for the next succeeding election for the office held or sought at the time of filing of the affidavit whichever occurs first. An affidavit filed under this section may not be rescinded.

(c) The director of taxation shall not allow any individual or married couple filing jointly to take a deduction against any tax due, pursuant to section 235-7(g)(2), for any contribution to a candidate for statewide or county office, who has not filed an affidavit as provided in this section[.], unless the candidate is seeking election to an office in the district in which the individual or the individual's spouse is registered to vote.

(d) The commission shall forward a certified copy of any affidavit filed under this section to the director of taxation.

[(e) The director of taxation shall only allow an individual or married couple filing jointly to take an income tax deduction, pursuant to section 235-7(g)(2), for any contribution to a candidate for a statewide or county office, if a receipt is attached to the state income tax return. Canceled checks or copies of the same shall be considered adequate receipt forms.

(f)] (e) If a candidate has not filed an affidavit pursuant to this section, the candidate shall inform all contributors to the candidate's campaign in writing immediately upon receipt of the contribution that they are not entitled to count their contributions to the candidate for purposes of taking a tax deduction under this section[.], unless the contributors were registered to vote in the district from which the candidate was seeking election at the time that the contribution was made."

SECTION 3. Section 235-7, Hawaii Revised Statutes, is amended by amending subsection (g) to read as follows:

"(g) In computing taxable income there shall be allowed as a deduction:

(1) Political contributions by any taxpayer not in excess of $250 in any year; provided that such contributions are made to a central or county committee of a political party whose candidates shall have qualified by law to be voted for at the immediately previous general election; or

(2) Political contributions by any individual taxpayer in an aggregate amount not to exceed $1,000 in any year; provided that [such]:

(A) Those contributions are made to candidates as defined in section 11-191, [who] if either:

(i) The individual taxpayer is a registered voter who resides in the district in which the candidate is seeking election, regardless of whether the candidates have agreed to abide by the campaign expenditure limits as set forth in section 11-209; or

(ii) The candidates have agreed to abide by the campaign expenditure limits as set forth in section 11-209; and [provided further that not]

(B) Not more than $250 of an individual's total contribution to any single candidate shall be deductible for purposes of this section."

SECTION 4. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 5. This Act shall take effect upon its approval; provided that section 3, upon its approval, shall apply to taxable years beginning after December 31, 2001.

INTRODUCED BY:

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