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501(c)(3)s Cautioned About Political Campaign Activities

May 6, 2004

The Internal Revenue Service published an advisory April 28 reminding exempt organizations that they are prohibited from engaging in political campaign activities. Colleges and universities exempt from tax under Section 501(c)(3) should take steps during this presidential election year to ensure that campus activities are in compliance with IRS rules. Should the IRS find that an organization has engaged in prohibited campaign activities, the consequences are revocation of exempt and excise taxes on the amounts spent on the activity.

While 501(c)(3) organizations are permitted to sponsor debates or discussion forums to educate voters, those events may not show a preference for or against a particular candidate. Under IRS rules, Section 501(c)(3) organizations are prohibited from

• endorsing candidates;
• making campaign donations;
• engaging in fundraising; and
• distributing statements or becoming involved in any other activities that might be beneficial or detrimental to any candidate, including activities that encourage individuals to vote for or against a candidate based on nonpartisan criteria.

The IRS has issued similar advisories in past presidential election years.

Full text of IRS advisory IR-2004-59

Other IRS resources about the political campaign prohibition

IRS Publication 1828, Tax Guide for Churches and Religious Organizations