Soft Money can be defined as money that is donated to a political party that is not subject to strict federal limits - in other words, donations go unregulated.

Soft money can come from individuals and political action committees, but they may also come from any other source.

The only restriction on soft money is that it is to be used for party-building activities, not for the promotion of electoral candidates.

This party-building requirement is a rather loose term when it comes to what the money can be spent on - the money often ends up getting used for campaigns promoting the passage of laws, voter registration and issue ads.

After the passage of the Bipartisan Campaign Reform Act 2002, soft money was somewhat regulated to prohibit parties using it for federal elections. This has meant that other organisations, such as Super PACs or 527 organisations, have taken over much of the spending that was previously associated with political parties.

Legislation concerning the regulation of soft money has appeared before Congress before - most notably in 1996, which would have banned soft money and imposed voluntary spending limits on elections with the caveat of rewards for those candidates that would comply.

However, the legislation was killed off by a Republican filibuster.

Read our study note on hard money