The Dos and Don'ts for Charities in an Election Year

In the height of an election season, charity leaders sometimes feel sidelined by the tax code, believing that speaking out when elections are looming is too risky.

In fact, the rules governing charities leave lots of room for charities not only to advocate vigorously in service of their communities, even in an election year, but also to participate in the election itself.

By "charities," we mean nonprofit organizations exempt under Section 501(c)(3) of the Internal Revenue Code. As a general rule, nonprofit organizations, including those exempt under other sections, like social welfare organizations [501(c)(4)], labor unions [501(c)(5)], and trade associations [501(c)(6)], are permitted to influence elections more directly than charities. The subject of this article, however, is limited to charities.

And while charities cannot take sides in candidate elections, there is much they can do to promote issues of interest, educate candidates about those issues, inform the public about candidate views, and both encourage and enable voter participation in the election.

Armed with a better understanding of the rules, and how to implement them, charities can keep making noise and engaging their constituencies before, during, and after the election.

Issue Advocacy

The fact that an election is coming up does not mean that charities have to stay quiet about the issues that matter to them, even if candidates are also talking about those issues. It does mean, however, that charities have to be thoughtful about how they talk about those issues.

The IRS uses a relatively, but not completely, vague "facts and circumstances" test to determine whether a given communication constitutes issue advocacy or candidate campaign intervention. The former is permissible for a charity; the latter is not. The IRS looks at both the content and the context of a charity's communication and considers the presence or absence of a number of factors to decide whether the communication is appropriate for a charity.

Although there is no exhaustive list of factors, the IRS has identified in Revenue Ruling 2007-41 (PDF) the following factors as important to its analysis:

• Whether the communication identifies one or more candidates for public office (if yes, the risk goes up)
• Whether the communication expresses approval or disapproval for one or more candidates' positions or actions (if yes, the risk goes up)
• Whether the communication is delivered close in time to the election (if yes, the risk goes up)
• Whether the issue addressed in the communication has been raised as an issue distinguishing candidates for a given office (if yes, the risk goes up)
• Whether the communication targets voters in a particular election (if yes, the risk goes up)
• Whether the communication is part of an ongoing series of communications by the organization on the same issue that are made independent of the timing of any election (if yes, the risk goes down)
• Whether the timing of the communication and identification of the candidate are related to a nonelectoral event such as a scheduled vote on specific legislation by an officeholder who also happens to be a candidate for public office (if yes, the risk goes down).

The analysis is not just a counting of factors, though, and they don't all have equal weight. Much depends on the substance, appearance, and manner of distribution of the communication. A charity that knows the rules can design communications during election season specifically to ensure that it does not break the rules.

Educating and Engaging Candidates and Voters

Charities can also educate candidates and voters and promote voter participation in the election, so long as they conduct those activities in a way that does not reflect support for or opposition to any particular candidate or party for election. These "nonpartisan" activities, also explained more fully in Rev. Rul. 2007-41 (see link above), can include (among others) the following, if properly designed and conducted:

• Voter guides and candidate questionnaires
• Candidate forums and debates
• Voter registration activities that do not target voters based on voting preferences
  (Caution: Private foundations generally cannot fund or conduct voter registration drives.)
• Get-out-the-vote activities that do not target voters based on voting preferences
• Sharing previously prepared educational materials with all candidates in a given race, but not producing new material at a candidate’s request

A Few No-Nos

Of course, some activities that charities occasionally consider are clearly not permissible. These include (among others) the following:

• Asking candidates to pledge to support or oppose a particular position, if elected
• Endorsing any candidate or party for election at any charity event or in any charity publication, newsletter, e-mail, or social media communication
• Making contributions to candidates or parties
• Providing tailored information to candidates upon request
• Allowing a candidate or party to use any charity resources for campaign purposes

Stay Involved, but Manage Your Risk

The outcome of elections is often important to a charity's ability to accomplish its mission and to the well-being of its constituents. Fortunately, the onset of election season does not prevent charities from loudly and vigorously pursuing their charitable purposes. While there are risks to manage, charities that know the rules can stay actively involved in the public discussion, even during election season.

This article is for general informational purposes only and does not represent legal advice as to any particular set of facts. Please seek legal counsel as you deem necessary.

Additional Resources

From TechSoup

• Read about what grantees need to know about due diligence.
• Learn What's the Difference Between a Nonprofit and a Charity?
• Get background on Lobbying by U.S. Public Charities and Their Foreign Equivalents.
• Go deeper on Political Campaign Activity.
  
  

From Alliance for Justice

• Rules of the Game: Nonpartisan Election Year Advocacy (Podcast episode)
  
• Comparison of 501(c)(3) and 501(c)(4) Permissible Activities
• Praising and Criticizing Incumbents

From the IRS

• Election Year Activities and the Prohibition on Political Campaign Intervention for Section 501(c)(3) Organizations (PDF)
• Election Year Issues (PDF)

Originally published September 9, 2020. Last updated August 9, 2024 to include additional resources.