Most political campaign merchandise is taxable — here’s what campaigns should know in 2026

What’s changing?

There’s no new law.

What’s changing is the number of campaign stores coming online ahead of the 2026 elections — and many are assuming that political status means “tax-exempt.”

It does not.

Across most states, shirts, hats, yard signs, stickers, mugs, and other campaign-branded goods are taxable retail sales. Section 527 organizations are exempt from income tax, not sales tax.

Campaigns also often trigger multi-state nexus through:

• out-of-state print-on-demand or fulfillment partners
• large nationwide merchandise pushes
• fundraising kits shipped across state lines

Who this affects

• Political campaigns running Shopify, Woo, Etsy, or custom stores
• Print-on-demand vendors fulfilling campaign orders
• Marketplace facilitators that process campaign merchandise
• Agencies producing and shipping merch on behalf of campaigns

Why this matters

Campaigns often assume: “Because it’s a donation, it’s exempt.” That’s incorrect. If a buyer receives merchandise in exchange for payment, states treat the transaction like any other taxable retail sale.

The risk:

• Under-collecting sales tax
• Filing gaps across jurisdictions
• Notices from states right in the middle of election season

If you use TaxCloud, your campaign merch tax rates update automatically. We handle the state changes and filings — you focus on the campaign.

Next steps

• Confirm taxability of all merch (shirts, hats, stickers, signs, bundles)
• Review marketplace facilitator rules for on-platform sales
• Map nexus exposure based on fulfillment partners and order volume
• Automate calculation and filing before peak merch season hits