December 15, 2017
501(c)(3) Chartiable Organizations
Under current law, 501(c)(3) charitable organizations are prohibited from participating in, or intervening in (including the publishing and distributing of statements), any political campaign on behalf of (or in opposition to) any candidate for public office.
This line in the Internal Revenue Code, which restricts political activity by charities, is often referred to as the “Johnson Amendment”—named after then-Senator Lyndon B. Johnson, who introduced it in 1954.
The Council opposes any change to the Internal Revenue Code that would effectively repeal this prohibition on political intervention.
For More Information
- Joint Ad in Roll Call with Independent Sector and National Council of Nonprofits - Dec. 6, 2017
- Joint Letter with Independent Sector and National Council of Nonprofits to Tax Conferees - Dec. 5, 2017
- Nonprofits Must Sound the Alarm on House Tax Bill – Joint Op-ed by Vikki Spruill and Dan Cardinali
- Joint Statement of the National Council of Nonprofits and the Council on Foundations - Nov. 13, 2017
- Council's Statement on President Trump's Executive Order – May 4, 2017
- Op-Ed by Tim Delaney and Vikki Spruill: Keep Partisan Politics out of the Nonprofit Sector - March 22, 2017
- Policy Update: “Johnson Amendment” in the 115th Congress
- Letter from Council to Members of the 115th Congress – Feb. 9, 2017
- GiveVoice.org– An Initiative of the National Council of Nonprofits, Council on Foundations, BoardSource, and Human Services Assembly
501(c)(4) Social Welfare Organizations
There is another type of nonprofit organization—501(c)(4) social welfare organizations—which, under current law, are permitted to engage in some political activity, as long as it is not its primary activity.
In November 2013, the Department of Treasury and Internal Revenue Service (IRS) issued proposed guidance regarding tax-exempt, social welfare organizations on candidate-related political activities. These regulations created a more bright-line rule about what type of political activities do not qualify as promoting social welfare for 501(c)(4). The proposal created deep, and widespread concern across the sector—with a reported more than 122,000 comments submitted.
The Council was one of those concerned organizations, submitting comments to address three key issues presented by the proposed rules:
- The rules would chill civic engagement efforts of 501(c)(3)s—activities that are vital to a thriving democracy;
- If applied to the Council’s 501(c)(3) members, the political activity standard in the rules would be inconsistent with current tax law, which permits foundations to fund certain voter education and voter registration activities; and
- The rules go beyond the Treasury Department’s rulemaking authority.
In response to the overwhelming number of public comments on the rules—most in opposition—the Treasury Department withdrew the rules and promised to publish a revised version in the summer of 2015. Those revised rules have not yet been released.
The Council supports clarification of guidelines for political activity by 501(c)(4) social welfare organizations, but strongly opposes any new rules that would dampen nonpartisan activities and civic engagement efforts of nonprofit organizations—including 501(c)(3) charities.