§ 1.41-2A - Same—limitations and special rules.

(a) When payment must be made. A taxpayer may elect the credit under section 41 or the deduction under section 218 only if a political or newsletter fund contribution is actually paid within the taxable year for which the taxpayer claims the credit or deduction. The method of accounting the taxpayer uses and the date the contribution is pledged are irrelevant. Where a partnership makes a political or newsletter fund contribution, each partner is considered as having paid his or her distributive share of the political or newsletter fund contribution.

(b) Campaign committee supporting more than one individual. A section 41 credit or section 218 deduction may be available for a contribution of money to a campaign committee that supports, or intends to support, more than one candidate if at least one individual it supports is a candidate for the calendar year in which the contribution is made. However, if a taxpayer indicates at the time the contribution is made that it is for a specific individual, and that individual is not a candidate for the calendar year in which the contribution is made, no credit or deduction is available.

(c) Examples. The provisions of this section are illustrated by the following examples:

Example 1.

B, an individual, makes a contribution of money in 1977 to the Good Government Committee, which is a campaign committee. The Good Government Committee supports C and D in 1977. C is a candidate for 1977. D is not a candidate for 1977. B may elect the credit under section 41 or deduction under section 218 for the contribution in 1977.

Example 2.

Assume the same facts as in example (1), except that B earmarks the contribution solely to further the candidacy of D. B may not elect the credit under section 41 or deduction under section 218 for the 1977 contribution.