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14.1 Account Books

1. Generally

The treasurer must keep detailed and accurate records of all contributions received (including ticket sales and in-kind contributions), transfers in, any other income (for example, interest earned), disbursements made, and outstanding debts incurred. These records are used in the preparation of campaign finance reports.

All records and account books must  be retained for at least 2 years after the political committee  files its final campaign finance report. The treasurer’s books may be audited.

- § 13-221 of the Election Law Article

2. Contents

• Each asset received, expenditure made, and obligation incurred must be included in the account book along with the following information regardless of the amount of the contribution of expenditure:
  • The amount or value of the receipt or expenditure;
  • The date of the receipt or expenditure;
  • The name and address of the person from whom the asset was received or to whom the expenditure was made; and
  • A description of the asset received or the purpose for which the expenditure was made.
• The account books and records must contain the date, name and address of all persons making any in-kind contributions, a description of the in-kind contribution, and the fair market value of the in-kind contribution.
• Expenses must be supported by receipts and the receipts must be maintained as part of the books and records of the treasurer.

3. Lump Sum Entry v. Account Books

Under certain circumstances, lump sum entry may be used as a contribution entry on the campaign finance reports. However, the committee is not relieved of its duty to keep detailed and accurate records of the all the contributions making up the lump sum entry in the account book. If the account book does not have the names and address of each contribution made, any entries lacking this information will be deemed anonymous contributions and the committee may be subject to penalties of Election Law Article §13-239.

The only exception to the law is for spins, chances on a paddle wheel or wheels of fortune. For those expressly authorized exceptions, the account book must include the net amount received by the committee and a list of the name and address of each individual who attended the event.

- § 13-221 and13-240  of the Election Law Article

14.2 Campaign Bank Accounts

1. Generally

Every political committee must establish a checking account for its exclusive use. The checking account must be established at a financial institution that is located or operates branches in Maryland and the political committee should be the name on the account. All income (including loans) must be deposited in the campaign bank account. Personal bank accounts of the responsible officer or the candidate may not be used.

Besides the required checking account, the only other permissible account is a savings account. As a general rule, campaign funds must be maintained only in accounts where the principal is not at risk, e.g. in FDIC or state-insured bank accounts. Mutual funds, the stock market, and/or other investment arrangements where the principal is at risk are prohibited. Furthermore, the treasurer must be able to withdraw all of the funds immediately. If the campaign funds are invested in a manner where withdrawal at anytime incurs a penalty, e.g. certificates of deposit, this is also prohibited.

Interest earned must be recorded as income on the campaign finance report.

2. Opening a Campaign Bank Account

Most banks will require the following three items before allowing you to open a campaign bank account:

• Employer Identification Number. The form can be obtained by calling 800-829-3676 or at www.irs.gov. You need to file a Form SS-4 with the IRS to receive an EIN;
  Note:  It is not required that you be an employer to receive an EIN.
• Personal identification of the person opening the account; and
• A Resolution of Authority forms ( required to be signed by the treasurer and chairman). The Statement of Organization usually satisfies this requirement by the bank.

14.3 Tax-Related Questions

You may contact IRS Customer Service at (877) 829-5500 (toll free number) for information about tax liabilities of a political committee. The call center is open from 8:00 am to 9:30 pm Eastern Time. Alternatively, you may write to the IRS at the following address:

   Internal Revenue Service
   TE/GE Division, Customer Service
   P.O. Box 2508
   Cincinnati, OH 45201

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