Can a nonprofit lobby?

Simple answer: yes.

There are three levels to political activity for nonprofits.

1. Advocacy: All 501(c)3 nonprofits can “advocate” for an issue as long as there is NOT a bill attached to the issue.

  • Advocate by setting up meetings with your local politicians to inform them of your cause and what you are doing to make a difference in the community. Ask for their support: funding (small), endorsement, and raising awareness. Inform them of legislation affecting your cause.

2. Lobby: 501(c)(3) organizations (aka public charities) can engage in a limited amount of lobbying.

  • According to Alliance for Justice: To maximize the amount of lobbying in which a public charity can engage, many public charities choose to come under the 501(h) expenditure test (also called “making the 501(h) election”); organizations that do so are often referred to as “501(h) electors.” The 501(h) expenditure test establishes specific dollar limits that are calculated as a percentage of a charity’s total exempt purpose expenditures. 501(h) electors may use up to 20% of the first $500,000 of its exempt purpose expenditures to lobby.

3. Electoral Politics: nonprofits can not engage in electoral politics, i.e. supporting specific candidates or working on a candidate’s campaign.

  • To support candidates and engage in other electoral politics, a nonprofit must apply for a 501(c)4. A 501(c)4 is permitted to engage in unlimited lobbying and limited partisan political activities. Nonprofits can hold both a 501(c)3 and a 501(c)4, but must maintain separation between these entities in order to protect the tax-exempt status of the 501(c)(3) organization. Note: Donations to a (c)4 are not deductible like donations to a (c)3.

For more information, please check out the Alliance For Justice: http://www.afj.org

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