H.R. 9771: Stopping Foreign Influence in Elections Act of 2026

This bill would create new tax penalties for certain tax-exempt organizations that give money to political committees or certain political advocacy groups after having received money from foreign nationals within the prior two years.

What organizations are covered

The bill applies to certain tax-exempt organizations under section 501(c) that must file annual tax returns and meet one of these size thresholds in the prior year:

• Gross receipts of at least $200,000, or
• Assets of at least $500,000.

It uses the term foreign national as defined under federal election law. An organization could generally rely on a donor’s statement about their nationality unless it knows, or should know, that the statement is false.

What counts as a prohibited contribution

The bill defines a covered contribution as any contribution made by one of these organizations to:

• a political committee, or
• a section 501(c)(4) organization that is tax-exempt.

A contribution is treated as covered if, during the prior two years, the organization received any contribution or gift from a foreign national. The two-year lookback starts on the date of the contribution, and time before the bill becomes law does not count in that period.

Penalties on the organization

If a covered organization makes one of these covered political contributions, the IRS would impose penalties in addition to existing law:

• First violation: a tax equal to 100% of the contribution.
• Second violation: a tax equal to 200% of the contribution.
• Third and later violations: a tax equal to 200% of the contribution, and the organization would lose its tax-exempt status for two years starting on the date of the contribution.

If an organization goes two years without making one of these covered contributions, earlier violations would no longer count for purposes of determining whether a later contribution is a first, second, or subsequent violation.

Penalty on the recipient committee or group

The bill also adds a separate tax penalty on the political committee or other recipient organization if it accepts a covered contribution from a qualifying tax-exempt organization. The penalty would be twice the amount of the contribution.

When it would take effect

The new rules would apply only to contributions made one year after enactment or later.

Relevant Companies

None found