I cannot find any CPA who knows the answer to this in my area. Hoping a Tax Guru here can help!

I am forming a 527 tax-exempt political committee in Arizona. This is a state committee, not a federal committee. I would like liability protection so the suggestion was made that I form an LLC or unincorporated association that in turn forms the 527. AZ does not recognize Unincorporated Associations so that option is out. As to the LLC, if it elects to file as a C Corp or S Corp, am I correct that I would have to take my fees for managing the 527. (may be full time job) as a salary subject to quarterly estimates and withholdings, and that I would need to set a reasonable salary in accordance with industry standards (in otherwords, if a Sub S, it would not fly to take a very low salary and the rest as distributions as this might open me up to IRS challenges).

If I am correct about the above, this structure does nor work for me because, having run a 527 previously ( with no liability shield), fundraising results vary from month to month and can be highly unpredictable. It is not a situation that can necessarily support a set salary. It is a situation where you may
have zero to pay yourself one month, enough to pay yourself a little another month and maybe enough to pay a decent amount another month. I defintely do not want to get into a situation of payroll tax reporting and withholding. I would also prefer to avoid the time involved with keeping corporate formalities.

This said. an LLC filing as a disregarded entity in Sched C is perfect regarding the above objectives and I have such an LLC now for my existing small business. However, since income and expenses flow through to the personal Sched C, how would this work for the fundraising revenues and the expenses
of the 527 which I would not think should be co-mingled with my personal income/expenses nor do I assume this would be advantageous to me.

As an FYI, this would be a single member, Manager managed LLC and would have no employees for the forseeable future, if ever (depending on fundraising results).

Can any tax guru here comment or clarify my assumptions and recommend the best organizational structure for "holding" the 527? Again. the objectives in priority order are:

1. Liability protection
2. Avoiding having to take a salary and get into payroll tax system
3. A outing corporate formalities if possible.

Thank you so much Tax Gurus!! I have hit a brick wall on this so hope you can help me!!

Mimi