Bill would tax nonprofits that mix foreign money with political spending

What does this do?

The bill taxes tax-exempt nonprofits that accept a donation from a foreign national and then, within two years, give money to a political committee or 501(c)(4) group. Penalties start at a tax equal to the full contribution amount, double to 200% for a second violation, and add a two-year loss of tax-exempt status for a third or later violation. The rule applies to contributions made starting one year after the law is signed.

Who does it affect?

The rule targets larger nonprofits with at least $200,000 in yearly income or $500,000 in assets, along with political committees and their donors.

Why does it matter?

The measure raises the financial risk for nonprofits that combine foreign donations with domestic political spending, aiming to curb indirect foreign influence on U.S. elections.

What does it cost, and who pays?

• First offense: 100% tax on contribution
• Second offense: 200% tax
• Third offense: lose tax-exempt status 2 years