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Dark MoneyMay 20, 2026

How PACs Donate Without Disclosing Donors

6 min readby SlushFund Research

The FEC allows unlimited contributions to "dark money" groups that don't have to disclose their donors. These seven vehicles make it happen. Here is how each one works.

The Seven Dark Money Vehicles

501(c)(4) Social Welfare Organizations
IRS Section 501(c)(4) · None required on donors
No donor disclosure to IRS; only required to report "substantial" contributors on annual Form 990
Contribute to (c)(4) → (c)(4) spends on political activity → donors legally undisclosed
Super PACs (Independent Expenditure-Only PACs)
FEC, post-Citizens United · Must disclose donors to FEC, but can receive unlimited "independent" contributions
Cannot contribute directly to candidates; can spend unlimited $ on "independent" ads
Contribute to Super PAC → Super PAC reports contributions received but not original donors
LLCs (Limited Liability Companies)
State corporate law + FEC · Single-member LLCs often treated as individual donors
LLC can contribute as one "person" regardless of actual number of beneficial owners
Form LLC → contribute to PAC → FEC sees LLC name, not individual members
Trade Associations (501(c)(6))
IRS Section 501(c)(6) · Members not disclosed; only organization-level political spending reported
Can spend on politics as "member benefits" without disclosing member donors
Business pays dues to (c)(6) → (c)(6) spends on politics → member identities private
Hybrid PACs (Super PAC + Traditional PAC)
FEC, dual structure · Traditional PAC side discloses; "non-contribution" arms do not
Can route unlimited dark money through non-contribution accounts while maintaining a "transparent" PAC arm
Donate to hybrid arm → fund "non-contribution" account → spend on politics with no donor disclosure
Donor Advised Funds (DAFs)
IRS Rev. Rul. 88-38 · DAF sponsor does not have to disclose donors who contribute to DAF
Donor advises fund how to distribute; fund spends on politics; original donor never publicly disclosed
Donor contributes to DAF → DAF contributes to (c)(4) or PAC → original donor identity disappears
Non-Profit Pass-Throughs (c)(3) → (c)(4)
IRS Sections 501(c)(3) and 501(c)(4) · Donors to (c)(3) are never disclosed; (c)(3) can fund (c)(4) without disclosure
(c)(3)s are prohibited from spending more than 49% of activities on politics — but there is no prohibition on transferring funds to a (c)(4)
Donor contributes to (c)(3) foundation → foundation grants to (c)(4) → political spending occurs

The DISCLOSE Act: What It Would Do

The DISCLOSE Act — passed by the House in 2022, died in the Senate — would have required organizations spending more than $10,000 on politics to disclose donors above that threshold. It would have closed most of the LLC loophole, required (c)(4) organizations to disclose donors above $10,000, and mandated that Super PACs disclose the original source of any contribution over $10,000.

Every major dark money organization — left and right — lobbied against it. The Koch network alone spent an estimated $12 million opposing the DISCLOSE Act in 2024. The bill has not been reintroduced in the 2025-2026 session.

The LLC Loophole in Practice

In the 2024 cycle, SlushFund identified at least $340M in contributions from LLCs to political organizations where the true beneficial owner was not disclosed. In 23 cases, the LLC was incorporated fewer than 90 days before making a contribution of $1M or more. In 7 cases, the LLC was incorporated after the election and contributed to groups that spent money in that same election.

Why This Persists

The FEC is designed to be evenly split between the two major parties. That split means any enforcement of existing dark money rules requires bipartisan agreement — which has not happened since 2012. The commission has had a deadlocked vacancy since 2023. It cannot enforce its own rules because it cannot achieve the required majority vote.

The gap between what the law says and what the law does is where dark money lives.

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