Lobbying by 501(c)(3) Tax-Exempt Organizations

The permissibility of lobbying by nonprofits is widely misunderstood and many nonprofits needlessly limit their participation in public debates of critical legislation.  IRS regulations permit, and in some ways expect, nonprofits to be engaged in legislative activities as long as the activity falls within specific guidelines. 

The IRS draws a sharp distinction between political activities and legislative activities.  The first is prohibited while the second is not. 

While the IRS regulations can seem complex and the penalties harsh, most nonprofits will find that a focused lobbying program that is coordinated with delivery on its mission is safely within these limits.  Monitoring legislation and informing one’s membership is virtually unlimited. 

At least at the state and local level, hiring a lobbyist to support or oppose particular legislation will almost always remain under six figures, safely below the limits for any nonprofit with mission-related expenditures over $300,000 per year.  And sharing lobbying expenditures with similarly situated nonprofits further reduces the reportable amount. 

Click on this link for a short summary of the do's and don'ts of lobbying by nonprofits.

Click on this link for a basic explanation of the rules on political and lobbying activities.

Click on this link for IRS publications on political and lobbying activities.

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