Election season is almost in full swing. Every year we are asked by nonprofit executive directors about policity actitivity at nonprofits. Americans will be electing a new President in 2016. There are many important issues at stake and without a doubt issues that impact the work of your nonprofit organization and your stakeholders. Despite recently court ruling holding corporations to have certain rights under the Bill of Rights, the IRS has long-standing restrictions on the advocacy and political activity of 501(c)(3) nonprofit corporations. This is the first of a series of blog posts that will explore these rules and regulations. This post focuses on 501(c)(3) nonprofit organizations and political advocacy and activity.
This blog is presented for informational purposes only. Please contact a licensed attorney if you have any specific questions or concerns about the political activity at your nonprofit organizations.
NO PARTISAN POLITICAL ACTIVITY
The IRS completely prohibits all partisan political activity. This means that 501(c)(3) nonprofit organizations cannot “directly, or indirectly, participate in, or intervene in (including the publishing or distributing of statements), any political campaign on behalf of or in opposition to any candidate for public office.” Doing so could result in loss of the organization’s tax-exempt status, resulting in taxes being imposed on both the organization and its Board of Directors and officers.
NONPARTISAN POLITICAL ACTIVITY IS USALLY OK
Organizations can engage in a variety of non-partisan political activities. This includes voter education, registration and ‘get out and vote drives’. The most important factor is that these activities are not biased or favor one party or candidate over another. 501(c)(3) organizations can engage in non-partisan activity designed to educate voters, such as public forums and the publication (print or electronic) of voter education guides. It is also permissible to conduct voter education (where and how to vote) and registration.
501(c)(3) organizations can also host candidates or have a legislative breakfast in which politicians come to discuss pertinent policy issues with key agency stakeholders. These candidate appearances are permitted as long as the organization provides equal opportunity to all political candidates seeking office and provides a fair, non-partisan forum. Whether this activity constitutes political intervention will be determined by the surrounding facts and circumstances. Generally speaking, organizations should extend invitations to all candidates seeking the same office.
At the actual event, all candidates must be given an equal opportunity to participate. This includes both “the nature of the event” and the “manner of the presentation.”
The IRS will consider all of the facts and circumstance surrounding these types of events when deciding whether the activity is non-partisan and permitted, or partisan and in violation of the political intervention ban. Generally speaking, fairness and equal opportunity are the gravamen of this inquiry. Questions asked to the candidates must give both sides an opportunity to present his or her views on the topics being discussed. The organization must also allow all candidates an equal chance to discuss and debate issues, and to present both sides of the issue.
Our post next week will examine issue advocacy at 501(c)(3) nonprofit organizations.
Jeff Fromknecht, MSW, Esq, Side Project Inc.