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FEDERAL ELECTION CAMPAIGN CONTRIBUTION LIMITS AND PROHIBITIONS

Funds raised to test the waters are subject to contribution limits. Moreover, the individual who is testing the waters may not accept funds from prohibited sources.

Limits

Keep in mind that contribution limits apply to all the support given to an individual who is testing the waters, even donations from a family member or friend. The limits apply, for example, to:

Gifts of money, goods and services;

Loans (except bank loans);

Certain staff advances until repaid;

Endorsements and guarantees of bank loans; and

Funds given or personally loaned to the individual to pay for his or her living expenses during the testing-the-waters period

Prohibitions

In observing the law’s prohibitions, the individual may not accept money from:

Labor organizations (although funds from a labor separate segregated fund — also called a PAC — are permissible);

Corporations, including nonprofit corporations (although funds from a corporate separate segregated fund — also called a PAC — are permissible);

Foreign nationals;

Federal government contractors.