This spring, the IRS received more than 139 million individual income tax returns. These returns give taxpayers the option to direct a portion of their tax payments into the Presidential Election Campaign Fund (PECF). Eligible presidential candidates can use this money to cover eligible expenses for political activities during both the primary and general elections.
But many of us reject that option: we don’t need or want it anymore?
On Form 1040, just below the section where filers enter their (and their spouse's) Social Security numbers, there is a 1.5 square inch PECF section where filers can check a box for themselves (and their spouse) and direct $3 of their tax payment ($6 for joint filers) to PECF.
I asked a group of friends if they checked the box. Only two people did, and to be honest, my spouse and I did not. The fund is meant to encourage public financing of elections and limit the influence of big donors, but the percentage of taxpayers taking advantage of the program has fallen dramatically since the 1970s, when the fund was established. TPC looked at Federal Election Commission (FEC) data, which shows that the percentage of taxpayers who checked the box has fallen from 28% in 1976 to 3% in 2023.
Several factors contribute to this decline, including the increasing complexity of campaign finance, the rising costs of elections, and the growing influence of private donations.
The options have evolved over the years, from Form 4875, the presidential campaign finance statement used in 1972, to a check box included on Form 1040. I checked the box on 1040EZ in 1986 because I remembered seeing coverage of the Watergate scandal on the news a decade ago, and as a new taxpayer, I was proud to be able to donate to a fund that could limit the influence of my money on presidential elections.
More recently, my TPC colleagues Aravind Bodupali and Erin Hafer argued in 2019 that the fund’s design is flawed. Unfortunately, their argument still stands. If every taxpayer contributed $3 to the fund this year, the fund would collect more than $417 million. But as of April 30, taxpayers had contributed $8.7 million to the fund. The total amount of funds contributed in 2024 may not exceed $25 million.
The fund currently holds about $416 million. However, given the limits on public funding and the lack of a federal cap on individual political contributions, presidential candidates have been reluctant to publicly fund their campaigns. The last presidential candidates to choose PECF funds at the start of their presidential campaigns were former Governor Martin O'Malley (D-MD) in 2016 and the late Senator John McCain (R-AZ) in 2008.
The Congressional Research Service has documented the limitations of the PECF and the policy challenges inherent to public financing of election campaigns for years, and Congress has found, and is likely to continue to find, alternative ways to use the money.
So my spouse and I don't check the boxes, and it feels like our efforts are going to waste.
Former Vice President Mike Pence requested public funds for his presidential campaign on October 12, 2023. Although Pence suspended his campaign two weeks later, the Federal Election Commission allows candidates in primary elections to continue to request funds even if they are not continuing their campaign, as long as they use the funds to repay campaign finance debts. Pence's campaign committee had more than $1.3 million in unpaid debts as of the end of March this year. Pence may receive PECF funds to repay these debts by the first Monday in March 2025.
Will future candidates follow his example? The cost of presidential elections continues to rise. The 2020 presidential election cost a record $14.4 billion, and the 2024 election is already on track to cost even more. Could PECF be the light at the end of the tunnel for a failed campaign? If people associate PECF with candidates who have no chance of winning, could it be yet another reason to skip the box?
Meanwhile, one of my friends said about PECF, “I might donate if the candidates were different.”
An interesting question arises: What if PECF was about process and not people?
The Bipartisan Policy Center recommended in 2022 that policymakers rethink and redesign the PECF as a dedicated fund for block election administration grants to state and local election officials, saying doing so would “give Congress the authority to invest directly in free and fair elections for the American people, improving our democracy in the most democratic ways.”
I don’t know what my friend thinks, but the reforms would have me and my spouse happily checking that box. 
Tax Watchdogpublished once a month, helps people outside the tax industry understand tax policy by connecting tax issues with everyday concerns. Have a question or comment? Send Renu an email.
