Should You 'Rush $5 Now!' to Your Favorite Political Candidate? Read This First.

Published: March 25, 2022 | Last Updated: July 14, 2023

Without looking at the date on the calendar, it wouldn’t be hard to know it’s election season from the number of solicitations from candidates and related groups cluttering inboxes everywhere. But before deciding whether or not to “Rush $5!” it’s worth evaluating various ways to support a favorite LGBTQ+ candidate with one’s hard-earned dollars.

Data from the American National Election Studies analyzed by the Pew Research Center showed about 12 percent of Americans said they gave to candidates in 2016, 9 percent gave to parties and 5 percent gave to other groups. That might not sound like a lot, but it represents an increasing trend. Further evidence shows — and conventional wisdom suggests — the more politically engaged a person is, the more likely they are to donate. Community advocate Trevor Thomas agrees.

“If they’re reading Between The Lines, they're already an advocate or engaged,” Thomas said. “And so I would suggest that they should know how to best use their dollars and [how] to be most effective.”

Pride Source sat down with Thomas, a former chair of Equality Michigan Action Network, a 501(c)(4) nonprofit, to get his take on the various ways you can donate to political candidates and causes — LGBTQ+ ones in particular. He said it all depends on strategy. “Your entire approach is gonna depend on your goals and overall strategy,” Thomas said. “If you are the donor, what are you trying to accomplish? What is your level of exposure to risk?”

Establishing a strategy for political giving isn’t just for big donors. Education is key, and that’s not only true when it comes to a candidate’s platform. Not everyone knows the limits — or that there are limits — depending on where, how, and to what political office.

In Michigan, for example, an individual can donate up to $1,050 per election cycle to a candidate for state representative, $2,100 to a candidate for state Senate and $7,150 to a state level candidate. Donating in other ways, like via a political action committee (PAC), can have limits, too. For example, on the federal level, an individual can donate up to $2,900 to a candidate per election cycle, and up to $5,000 to a political action committee for 2021-2022.

In cases where donations are public information, one’s “risk level” is part of the equation. Thomas emphasized what’s important here is “your personal risk level with the affiliation of a candidate or organization that you might be supporting — and that does matter in many instances to the donor, but it also could matter to the candidate receiving funds.” This could arise in terms of professional reputation depending on where one’s money is going and who knows about it.

Thomas pointed out the public perception of candidate support, in terms of dollars, is often skewed because the entire picture isn’t presented at once.

“When we think about fundraising, because this is publicly reported, you'll see this in kind of the media horse race of who has raised more than the other,” Thomas said. “The truth of the matter is that's only one indicator, because…in the c4 space [nonprofits classified under the federal code 501(c)(4)], you do not have publicly available numbers, and so without limits in the c4 space too, there can be a lot of activity happening there, quite frankly, significantly dwarfing the activity happening in the space with the political action committee.”

For the donor, there are caps and limits to think about, too, Thomas said. But what he really emphasized was when to donate.

“[If] your goal would be, ‘I want the candidate to win,’ you're going to want to donate the most amount you're comfortable donating to the candidate committee as early as possible,” Thomas said. “So a dollar donated now to someone running in 2022 is significant, but a dollar donated last year is even more significant.” One reason is that campaigns today are about resources and momentum, he said.

The other reason? “Rare is the day that someone makes an independent decision about a candidate," Thomas said. "Most individuals making decisions follow the leader, and so for the candidate, you need to show a great number of followers early.”

Donating early, especially monthly, can help a campaign plan more effectively. And when it comes to donations very late in the game, “I really won't comment that it's not effective, but you're most likely paying for staff salaries after the election day,” Thomas said.

Thomas also addressed whether those small dollar donations matter. Certainly, donations of all sizes further the cause. But they’re also important because candidates can then show a greater number of individuals supporting the campaign. He had a few things to add about strategy.

“In the individual space, on deciding to donate, you can choose that you're at the table to change the world, you can have a goal of raising your visibility and influence, you can have a goal of impacting policy,” Thomas said. “Most people gravitate to candidate activity, but there's a lot of things you can choose to do. Most donor advisors…will advise to potentially engage in multiple avenues, if it's about making an impact. Think of your different options — c3, c4 PAC, Super PAC [and] candidate committee as tools.”

Common Ways to Donate: A Brief Guide

Note: The following information is based on donations made by individuals only.

501(c)(3) nonprofit

Local examples: Ruth Ellis Center, Stand with Trans, Fair Michigan, Lansing Association for Human Rights (LAHR), Equality Michigan, LGBTQ+ community centers such as Affirmations

National Examples: National Center for Transgender Equality, The National LGBTQ Task Force, Transgender Law Center, Lambda Legal

Functions: 501(c)(3)s serve a charitable, religious or educational function.

Political activity: This type of nonprofit is not permitted to participate in any political campaign, either directly or indirectly. However, they may engage in limited political activity if it furthers the nonprofit’s mission. For example, a community center may hold nonpartisan voter registration drives or voter education events. Some lobbying or issue advocacy is permitted, as long as it’s not a “substantial part” of the (c)(3)’s activities in time and effort.

Tax-exempt organization: Yes

Donations tax-deductible: Depends on the donor’s particular tax situation. Up to $300 per individual in 2022.

Donations subject to disclosure: No

Limit on donations: No

501(c)(4)

Local examples: LGBT Detroit Mobilization, Equality Michigan Action Network, Planned Parenthood Advocates of Michigan

National example: Freedom for All Americans, Human Rights Campaign (HRC also has an affiliated 501(c)(3) and a PAC)

Function: 501(c)(4)s are “social welfare organizations” that may serve a political education function and may do political lobbying. They may engage in issue advocacy but may not lobby expressly for a particular candidate.

Tax-exempt organization: Yes

Donations tax-deductible: No

Donations subject to public disclosure: No

Donors or 501(c)(4)s may choose to make their donations public.

Limit on donations: No

Political Action Committees

There are many categories of PACs

Local examples: Unity Fund PAC, West Michigan Progress PAC

National examples: Victory Fund, LPAC, Equality PAC, LGBTQ+ Voter Fund (via Movement Voter PAC)

Function: Political Action Committees pool campaign contributions from members and donates those funds to campaigns for or against candidates, ballot initiatives or legislation.

Tax-exempt organization: No

Donations tax-deductible: No

Donations subject to public disclosure: Yes

Limit on donations at the federal level: $5,000 per year for 2021-2022

Political Party: Local, district, state, national

Example: Michigan Democratic Party (Donations made to the MDP may be flagged for the LGBT & Allies Caucus.)

Function: Political parties are known as 527 groups, as designated by the IRS. Their primary purpose is influencing the election or selection of candidates to political office. A 527 group may not coordinate its activities with a particular campaign.

Donations limits: Yes. Varies: For example, a combined donation to local, district and state party committees may not exceed $10,000.

Candidate Committee

Function: Candidate committees are a type of 527 group formed under the direction and control of a candidate for the candidate’s campaign for a specific office

Donation limit: For federal level, $2,900 per individual per year. For the state of Michigan, the Michigan Campaign Finance Act establishes contribution limits for publicly held offices and can vary by office or district.

All political contribution limits for local level offices, state level offices and others can be found on the Michigan Bureau of Elections website.

Donations publicly disclosed: Yes. Individual contributions made at the federal level are available to search in the Federal Election Commission’s database. Contributions to state level candidates can be found in the Michigan Campaign Finance searchable database.