Read time: 10 minutes
Three things we like:
- Advocating for causes we care about!
- Educating and mobilizing voters!
- Winning elections!
Three things we don’t like:
- Running afoul of tax and campaign finance rules regarding 501(c)(3) and 501(c)(4) political activities.
- Accidentally committing crimes.
- Going to jail.
Election season can be tricky for 501(c)(3) nonprofits who are worried about crossing the legal line—or aren’t even sure where that line is. So we compiled nine of the questions we hear the most from our nonprofit clients and asked our friends and election law experts from Bolder Advocacy to help answer them.
Warning / Yay!—This gets weedy. However it’s worth reading all the way through if your organization works on advocacy. It will help you keep out of trouble while also not missing one of the best moments to advance your cause.
Elections: 501(c)(4) vs. 501(c)(3) Activities
What can a 501(c)(4) do during election season that a 501(c)(3) cannot do?
A 501(c)(3) organization may not support or oppose candidates running for public office. That’s pretty clear cut. A 501(c)(4) organization can devote resources to that kind of electoral work—as long as doing so does not constitute their primary purpose.
Therefore, a 501(c)(4) organization may do the following things that 501(c)(3) organizations may not:
- Endorse candidates and publicize the endorsement
- Publish voter guides that compare or rank candidates
- Engage in politically targeted voter registration or mobilization efforts designed to help specific candidates
- Post partisan political messages on Facebook, Twitter, & other social media
- Pay for advertising supporting or opposing candidates
- Establish and pay for administrative and fundraising costs of an affiliated political organization
- Ask candidates to sign a pledge
To compare and contrast the types of activities permissible for 501(c)(3)s and 501(c)(4)s, check out Bolder Advocacy’s at-a-glance table.
When engaging in political activity, 501(c)(4)s must comply with federal, state, and local election law. For instance, a 501(c)(4) may not make contributions to candidates for federal office, while some states allow such contributions. Moreover, 501(c)(4)s involved in partisan political advocacy and even some issue advocacy close to an election may need to include specific disclaimers and file timely reports of their activity. For more information on election year advocacy for 501(c)(4) organizations, including what is considered primary purpose activity and what is considered secondary (or political activity), you can view Bolder Advocacy’s publication The Connection.
What’s different about 501(c)(3) advocacy during election season compared to non-election season?
A 501(c)(3) nonprofit can continue its advocacy work during election season, provided the activities are tied to the organization’s mission. Advocacy might include educating or attempting to influence the public on subjects such as healthcare, gun safety, workers’ rights, or environmental protection. It may also include persuading an elected official to take a specific action, like voting for or against proposed legislation (direct lobbying), or encouraging the public to ask elected officials to do so (grassroots lobbying). It’s even okay for 501(c)(3) organizations to use the occasion of an election to obtain greater exposure for their issues.
However, issue advocacy crosses the line into prohibited campaign intervention when a communication not only addresses an issue but also tries to tell the audience how to vote on a specific candidate or group of candidates. That’s not allowed, whether it happens explicitly (“vote for candidate X”) or implicitly (“vote for candidates that will protect the environment”). For best practices, tips, and examples refer to Bolder Advocacy’s publication, Rules of the Game: A Guide to Election Related Activities for 501(c)(3) Organizations.
Ballot Measures + Specific Candidates
Can 501(c)(3) and (c)(4) organizations work on ballot measures, and are there any special restrictions they need to know about working on these?
Yes, both 501(c)(3) public charities and (c)(4) organizations may support or oppose ballot measures, initiatives, referenda, state constitutional amendments, or any other policy put to a direct vote of the public.
This type of work is considered lobbying, and 501(c)(3)s have limits on how much lobbying they can do. Public charities can use either the “Insubstantial Part Test” or the “501(h) Expenditure Test” to measure their lobbying activity. Under the former, lobbying by a public charity is limited to an “insubstantial” part of its total activity. Under the latter, a public charity can spend up to 20 percent of its annual budget on lobbying expenditures (this percentage varies based on the charity’s annual expenditures). For more information, see Public Charities Can Lobby.
In contrast, 501(c)(4)s can spend an unlimited amount on lobbying.
Both 501(c)(3)s and 501(c)(4)s can engage in the following activities to support or oppose a ballot measure:
- Publicly endorse or oppose ballot measures
- Propose ballot measures
- Draft language for ballot measures
- Engage in litigation surrounding the appearance of a ballot measure on a ballot
- Organize volunteers to gather signatures on petitions
- Send staff to gather signatures or conduct other ballot measure campaign work
- Contribute money to ballot measure campaigns
- Loan money to ballot measure campaigns
- Host ballot measure campaign events at their offices
- Register people to vote and encourage them to vote for or against a ballot measure
- Repeat the words “ballot measure” so many times in so little space that it starts to sound silly
Because 501(c)(4)s can support or oppose candidates, they may also highlight where candidates stand on the measures.
Although federal tax law treats ballot measure activity as lobbying, states and localities may regulate them under campaign finance or other disclosure law. It is important for organizations to follow applicable laws. For more information on state specific information, you can view Bolder Advocacy’s Resource Library from information on over 30 states.
Ok this one is only quasi-election related but is very timely. What can my nonprofit say about Supreme Court nominees and their confirmation hearings or votes?
If you are a 501(c)(3) public charity, you can weigh in on and advocate for or against a Supreme Court nominee’s confirmation. The IRS has recognized that influencing the confirmation of federal judges is like influencing any other legislative vote—it is considered lobbying. So go right ahead, just remember that 501(c)(3)s need to ensure the activity does not exceed their lobbying limit.
However, there are ways 501(c)(3)s can educate the public about a judicial nominee and even comment on the nominees’ qualifications without lobbying. This includes taking advantage of the 501(h) expenditure test mentioned above to track lobbying activities and utilizing the nonpartisan analysis exception to lobbying.
501(c)(4) nonprofits can engage in an unlimited amount of lobbying, although they should ensure the activity is tied to their exempt purpose.
For more information on commenting on judicial nominations, see our factsheet here.
For more information on when advocacy is lobbying and how to maximize your advocacy through lobbying exceptions, see Bolder Advocacy’s Being a Player: A Guide to IRS Lobbying Regulations for Advocacy Charities.
Can my nonprofit send questionnaires to candidates?
Both 501(c)(3)s and 501(c)(4)s may prepare candidate questionnaires—although they must follow separate rules.
A 501(c)(3) can develop a candidate questionnaire to educate the voters impartially on a nonpartisan basis. They may NOT use a questionnaire to put one candidate in a better light than another, nor in any way suggest how people should vote. A 501(c)(3) must:
- Send the candidate questionnaire to all candidates in a specific race;
- Ask neutral, open-ended questions covering a broad range of issues; and
- Distribute the answers in an unedited, neutral way without commentary. For more information, see our fact sheet on Candidate Questionnaires and Voter Guides.
A 501(c)(4) organization may also send out candidate questionnaires, however there are fewer restrictions on their questionnaires. A 501(c)(4) questionnaire can:
- Ask candidates to take pledges or support the organization’s mission;
- Focus on a narrow range of issues; and
- Provide commentary or rankings based upon candidate answers.
If an employee of a 501(c)(3) is running for office, what should the 501(c)(3) do?
Individuals who work for 501(c)(3) organizations may run for office themselves. In fact, we’d probably be better off if there were more elected officials with nonprofit experience!
However, it is important for the 501(c)(3) associated with the candidate to avoid supporting or opposing the candidacy, or even giving the appearance of supporting or opposing the candidacy.
An employee who works for a 501(c)(3) organization may be able to continue working full-time while running for office, especially early in a campaign. The candidate should restrict their campaign activities to their off-work hours, and if a candidate’s campaign activity is interfering with their 501(c)(3) responsibilities or work hours, they should consider taking a leave of absence or otherwise take time off. Similarly, a charity should not allow its assets or facilities to be used for individuals’ personal campaign work (including obvious resources like letterhead, photocopiers, and telephones, as well as perhaps less obvious ones like distribution lists, mailing permits, wifi, and email accounts).
There may be additional restrictions for employees of nonprofit organizations that receive federal grants, who may be subject to provisions of the Hatch Act—a federal law that restricts the political activity of federal government employees. That’s definitely a question for an attorney rather than a blog post.
When do 501(c)(3) nonprofits need to make sure that they are being balanced with all candidates?
A 501(c)(3) nonprofit cannot provide preferential treatment to any candidate or political party.
When interacting with candidates—whether by inviting a candidate to speak, sending out candidate questionnaires, or hosting candidate forum—organizations should apply the same rules.
For instance, at a candidate forum or debate, organizations should invite all viable candidates, give each candidate an equal opportunity to present her views, and apply the rules equitably (e.g. by giving each candidate the same amount of time to speak). Similarly, when preparing a voter guide, the organization should send the questionnaire to all candidates, avoid editing the candidates’ responses, and publish all responses in the same font, the same print size, and in an impartial way.
And for more information about candidate appearances, see the question below.
For more information on election related activities for 501(c)(3) organizations, you can read Bolder Advocacy’s publication The Rules of the Game.
If a candidate for elected office appears at a public event put on by a 501(c)(3), what can the nonprofit do to ensure that the nonprofit doesn’t violate the prohibition on campaign intervention?
Candidates for public office may attend public events sponsored by 501(c)(3) following the same conditions as anyone else. However, the nonprofit should not provide preferential treatment such as free admission, promote the candidate’s attendance, retweet or repost the candidate’s photos, or in any way signal to the public to vote for the candidate that appeared.
If a 501(c)(3) wants to invite a candidate to appear, then the 501(c)(3) must navigate carefully.
The rules for hosting candidate appearances vary depending on the organization’s reason for inviting the candidate to speak. If the candidate is invited for a reason unrelated to the campaign, the nonprofit could promote the candidate’s appearance but should not reference that the individual is a candidate for election. On the other hand, if they are invited as a candidate, then the 501(c)(3) must take steps to ensure that it indicates no support of or opposition to the candidate at the event. All opposing candidates should be given an equal opportunity to participate, either at the same event or a comparable one. For more information, see our factsheet on candidate appearances.
Are there questions my 501(c)(3) needs to avoid asking at a town hall meeting of an elected official?
Staff and volunteers who are representing a 501(c)(3) organization at a town hall meeting can ask elected officials where they stand on various issues, including legislation under debate. If a 501(c)(3) expresses an opinion on specific legislation, the time spent preparing for the town hall, travel, and other expenses may count as lobbying expenditures. If the elected official is also a candidate, the 501(c)(3) must not ask the candidate to take a pledge to support specific issues if re-elected. For more information, see Rules of the Game.
What do I do if I have more questions?
We’re hopeful about where the midterm results will take our work and our country. If you have more questions, please be sure to reach out @mrcampaigns on Facebook or Twitter! You can also seek more answers, check out Bolder Advocacy’s advocacy coaches, trainings, and treasure chest of free fact sheets and in-depth publications at www.BolderAdvocacy.org.