Thomas Mann famously said that “Everything is politics,” and in some senses, he was correct. But 501(c)(3) organizations must avoid election-related political activity at all costs.
With a fiercely-contested national election campaign underway, and state and local races heating up, nonprofits must be especially careful not to get into the fray, no matter how close (or far) a candidate’s platform is to the charity’s mission.
The Internal Revenue Code states that section 501(c)(3) organizations are “absolutely prohibited” from directly or indirectly participating in, or intervening in, any political campaign on behalf of (or in opposition to) any candidate for elective public office.”
In other words, even one instance of such activity can jeopardize a public charity’s tax-exempt status or expose both the nonprofit and certain managers (including trustees) to excise taxes. And having to respond to any level of IRS or press inquiry about political activities may be a public relations and logistical nightmare for a nonprofit.
So what should a charity avoid? Obviously, it should NOT endorse or oppose candidates, make campaign contributions, or make public statements for or against a candidate (or distribute statements others make.) It should also avoid letting candidates use the organization’s assets or facilities. If a candidate attends a nonprofit’s special event and is permitted to speak about why they should be elected, that constitutes political activity. Likewise, allowing a candidate’s campaign to hold a “meet and greet” at a nonprofit’s facility violates the rule.
What about the website? Can you help it if another group links to your website? The bottom line is that nonprofits need to pay attention to where they link and who links to them. The IRS will look at links from (c)(3)s to other websites to evaluate whether the material on the linked site is attributable to the (c)(3) and the charity is doing indirectly what it is not permitted to do directly. If the two organizations are related, the risk increases.
Voter education, public forums, and voter registration drives are OK, so long as they are completely nonpartisan. Candidate questionnaires and public debates or discussions must include all viable candidates, be conducted impartially, and cover a broad range of issues. Voter registration or “get out the vote” drives should be motivated by increasing voter education and participation, not by hopes of shaping the outcome of an election.
Public charities should not indicate a preference for a candidate or a political party or platform, and should avoid politically-loaded words such as “conservative,” “pro-choice,” etc. It’s acceptable to focus on certain demographic groups, such as low income, homeless, or students, but not on a particular party or group who will be expected to vote a certain way. It’s critical that a nonprofit be able to document its strategy and the nonpartisan steps taken in case its activities are questioned.
Other potentially difficult situations include a candidate already on the board of trustees, or a nonprofit that supports issues that are closely aligned with a candidate’s position.
Individuals associated with a tax-exempt organization do not lose their rights to free expression and to support specific candidates. But these individuals must avoid making partisan comments at official organization functions or in organization publications.
In addition, whenever there is a risk of confusion, individuals should preface their political statements with disclaimers that the views are their personal opinions and do not represent the views of the organization. And, of course, any partisan comments should be avoided when a nonprofit employee or trustee is or appears to be “on the clock” or speaking on behalf of the organization.
The bottom line is that this is a complex and fact-sensitive area, full of potential minefields. Make sure your organization and its employees and board members are briefed on the rules, and get expert advice if you aren’t absolutely clear about a certain situation.
Do you have a question you’d like to us to address? Leave it in the comments below.
Nancy Eberhardt is New Jersey director of Pro Bono Partnership and a regular contributor to the Dodge Blog. Pro Bono Partnership provides free business and transactional legal services to nonprofits serving the disadvantaged or enhancing the quality of life in neighborhoods in New York, New Jersey and Connecticut. Learn more here.