In today’s political climate, it is understandable that nonprofit organizations might feel compelled to align themselves with people and causes that reflect their values. After all, many do exist to promote causes that are related to social and moral values. However, charitable nonprofit entities should be careful; engaging in partisan politics is not only risky, but it is also prohibited by federal law.
The IRS clearly states that 501(c)(3) organizations must be organized and operated exclusively for one of several enumerated exempt purposes and may not participate in any political campaign activity for or against political candidates. This means charities should not contribute to political candidates, make public statements calling on people to vote for specific candidates, or use organizational assets, including property, to favor a candidate or a political party. Consequences for partisan activity include loss of tax-exempt status and possibly financial penalties.
This prohibition is rooted in the very nature of what it means to be a 501(c)(3). Charitable nonprofit entities are, at their core, organizations meant to serve the public good, providing education, relief, guidance, or other charitable services that benefit all members of society. Therefore, behaving otherwise risks alienating members of the broader community and compromising the overall mission of public service.
With that said, nonprofits may engage in nonpartisan activities related to elections such as voter education and get-out-the-vote efforts, so long as these efforts do not evidence political bias. Simply put, neutrality is the key to remaining compliant.
Need Guidance? Campanella Law Office Can Help
If your organization has questions about political activity, compliance with IRS regulations, or maintaining your 501(c)(3) status, Campanella Law Office is here to help. Our attorneys provide clear, practical legal advice tailored to the unique needs of nonprofit entities.
(This blog, prepared by Campanella Law Office, is for general informational purposes only and is not intended to convey specific legal advice, nor is it intended to create or constitute an attorney-client relationship.)