Sen Whitehouse Pushes Bill To Close Dark Money Loophole

Legislation introduced Tuesday by a pair of Democratic lawmakers would close a loophole that lets billionaires donate assets to dark money organizations without paying any taxes.

The U.S. tax code allows write-offs when appreciated assets such as shares of stock are donated to a charity, but the tax break doesn't apply when the assets are given to political groups.

However, donations to 501(c)(4) organizations—which are allowed to engage in some political activity as long as it's not their primary purpose—are exempt from capital gains taxes, a loophole that Sen. Sheldon Whitehouse (D-R.I.) and Rep. Judy Chu (D-Calif.) are looking to shutter with their End Tax Breaks for Dark Money Act.

Whitehouse, a member of the Senate Judiciary Committee who has focused extensively on the corrupting effects of dark money, said the need for the bill was made clear by what ProPublica and The Leverdescribed as "the largest known donation to a political advocacy group in U.S. history."

read more