We knew that it had to happen. After IRS warned a church in California that it may lose its charitable status following a sermon critical of the current administration, those to the left and right alike began to scramble in their defense of political activism amongst 501(c)(3) organizations.
For organizations with 501(c)(3) status, political campaigning or promoting candidates is prohibited. Full stop. But it happens. And it happens a lot.
In fact, IRS investigations have revealed that nearly three out of four of 110 such organizations accused of violating the ban on “politicking” in the 2004 election did, in fact, do so.
In three cases, however, none of which were churches, the IRS felt that the activities warranted revocation of the groups’ tax-exempt status. The remaining organizations received written warnings, and, in at least one case, a penalty.
Among the prohibited activities, the examiners found that charities and churches had distributed printed material supporting a preferred candidate and assembled improper voter guides or candidate ratings.
Religious leaders had used the pulpit to endorse or oppose a particular candidate, and some groups had shown preferential treatment to candidates by letting them speak at functions.
Other charities and churches had made improper cash contributions to a candidate’s political campaign.
Think it’s over? Think again. The IRS has said that it plans to continue using the special task force to review the activities of charitable organizations, and its speedier procedures for this year’s election and in the future. Charitable organizations and the professionals that represent them may wish to refer to newly released guidelines for the upcoming election year.
