Erika K. Lunder
Legislative Attorney
L. Paige Whitaker
Legislative Attorney
During the 2010 election season, the political activities of § 501(c)(3) organizations are in the news, with allegations being made that some groups are engaging in impermissible activities. These groups are absolutely prohibited from participating in campaign activity under the Internal Revenue Code (IRC). On the other hand, they are permitted to engage in nonpartisan political activities (e.g., distributing voter guides and conducting get-out-the-vote drives) that do not support or oppose a candidate. Determining whether an activity violates the IRC prohibition depends on the facts and circumstances of each case, and the line between impermissible and permissible activities can sometimes be difficult to discern.
Due to the IRC prohibition, § 501(c)(3) organizations generally are not permitted to engage in the types of activities regulated by the Federal Election Campaign Act (FECA). However, the activities regulated under the IRC and FECA are not necessarily identical. An organization must comply with any applicable FECA provisions if engaging in activities regulated by FECA (e.g., making an issue advocacy communication under the IRC that constitutes an electioneering communication under FECA).
A recent Supreme Court case, Citizens United v. FEC, has received considerable attention for invalidating several long-standing prohibitions in FECA on corporate and labor union campaign treasury spending. This case does not appear to significantly impact the political activities of § 501(c)(3) organizations as they remain subject to the prohibition on such activity under the IRC. Similarly, while numerous bills have been introduced in the 111th Congress in response to Citizens United, it appears most would only minimally impact the activities of § 501(c)(3) organizations since they are already generally prohibited from engaging in the activities regulated under the bills. The primary legislative response to Citizens United, the DISCLOSE ACT (H.R. 5175, as passed by the House, and S. 3628) would expressly exempt § 501(c)(3) organizations from the legislation’s disclosure and disclaimer provisions.
This report examines the restrictions imposed on campaign activity by § 501(c)(3) organizations under the tax and campaign finance laws. For a discussion limited to the ability of churches and other religious organizations to engage in campaign activity, see CRS Report RL34447, Churches and Campaign Activity: Analysis Under Tax and Campaign Finance Laws, by Erika K. Lunder and L. Paige Whitaker.
Date of Report: September 2, 2010
Number of Pages: 11
Order Number: R40141
Price: $29.95
Follow us on TWITTER at http://www.twitter.com/alertsPHP or #CRSreports
Document available via e-mail as a pdf file or in paper form.
To order, e-mail Penny Hill Press or call us at 301-253-0881. Provide a Visa, MasterCard, American Express, or Discover card number, expiration date, and name on the card. Indicate whether you want e-mail or postal delivery. Phone orders are preferred and receive priority processing.
Legislative Attorney
L. Paige Whitaker
Legislative Attorney
During the 2010 election season, the political activities of § 501(c)(3) organizations are in the news, with allegations being made that some groups are engaging in impermissible activities. These groups are absolutely prohibited from participating in campaign activity under the Internal Revenue Code (IRC). On the other hand, they are permitted to engage in nonpartisan political activities (e.g., distributing voter guides and conducting get-out-the-vote drives) that do not support or oppose a candidate. Determining whether an activity violates the IRC prohibition depends on the facts and circumstances of each case, and the line between impermissible and permissible activities can sometimes be difficult to discern.
Due to the IRC prohibition, § 501(c)(3) organizations generally are not permitted to engage in the types of activities regulated by the Federal Election Campaign Act (FECA). However, the activities regulated under the IRC and FECA are not necessarily identical. An organization must comply with any applicable FECA provisions if engaging in activities regulated by FECA (e.g., making an issue advocacy communication under the IRC that constitutes an electioneering communication under FECA).
A recent Supreme Court case, Citizens United v. FEC, has received considerable attention for invalidating several long-standing prohibitions in FECA on corporate and labor union campaign treasury spending. This case does not appear to significantly impact the political activities of § 501(c)(3) organizations as they remain subject to the prohibition on such activity under the IRC. Similarly, while numerous bills have been introduced in the 111th Congress in response to Citizens United, it appears most would only minimally impact the activities of § 501(c)(3) organizations since they are already generally prohibited from engaging in the activities regulated under the bills. The primary legislative response to Citizens United, the DISCLOSE ACT (H.R. 5175, as passed by the House, and S. 3628) would expressly exempt § 501(c)(3) organizations from the legislation’s disclosure and disclaimer provisions.
This report examines the restrictions imposed on campaign activity by § 501(c)(3) organizations under the tax and campaign finance laws. For a discussion limited to the ability of churches and other religious organizations to engage in campaign activity, see CRS Report RL34447, Churches and Campaign Activity: Analysis Under Tax and Campaign Finance Laws, by Erika K. Lunder and L. Paige Whitaker.
Date of Report: September 2, 2010
Number of Pages: 11
Order Number: R40141
Price: $29.95
Follow us on TWITTER at http://www.twitter.com/alertsPHP or #CRSreports
Document available via e-mail as a pdf file or in paper form.
To order, e-mail Penny Hill Press or call us at 301-253-0881. Provide a Visa, MasterCard, American Express, or Discover card number, expiration date, and name on the card. Indicate whether you want e-mail or postal delivery. Phone orders are preferred and receive priority processing.
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