Introduction
With the focus of neighborhood associations and district coalitions on civic engagement, political activity and lobbying come with the territory. This lesson outlines how nonprofits can engage with these activities and how to stay within the federal guidelines.
Political Activity
501(c)(3)Tax-Exempt organizations and their board members are prohibited from:
- Financially supporting a campaign
- Endorsing or opposing candidates for public office
- Misrepresenting information.
The full text of the IRS restrictions of political campaign intervention for 501(c)(3) tax-exempt organizations can be found HERE
The IRS offers a 10 course online workshop for small to mid-size tax exempt organizations HERE
Lobbying
Definition: Attempting to influence pending legislation (Full Definition from U.S. Senate)
Lobbying is legal, and often very helpful to your organization, however too much lobbying may disqualify an organization from 501(c)(3) tax-exempt status. (IRS on Lobbying)
There are 2 types of lobbying as defined in IRC section 501(h)
- Direct Lobbying:
- A communication that expresses a view about specific legislation made to a legislator.
- Grassroots Lobbying:
- A communication that expresses a view about specific legislation made to the general public that contains a call to action.
Taking the 501(h) Election
Organizations wishing to take the 501(h) election can file IRS Form 5768. By submitting this form, nonprofits set lobbying expenditure ceilings. To learn more about the specifics of the 501(h) election and the sliding scale for setting expenditure ceilings go to:
Council For Nonprofits “Taking the 501(h) election”
Activities Not Considered Lobbying
“Organizations may involve themselves in issues of public policy without the activity being considered as lobbying. For example, organizations may conduct educational meetings, prepare and distribute educational materials, or otherwise consider public policy issues in an educational manner without jeopardizing their tax-exempt status.” -(IRS on Lobbying)