May a political organization deduct the salaries, rents and other expenses it incurs for its political campaign activity on Form 1120-POL? No, the political organization may only deduct those expenses that are directly related to earning taxable income. For example, the organization may not deduct the salary of its campaign director. However, if the political organization hires a broker to manage its stock portfolio, it can deduct that expense from the taxable dividend and capital gain income derived.
