Nonprofit Election Activities: Dos and Don'ts
If you are a TV viewer in a state that's up for grabs during this presidential election, your commercial breaks have likely been a flood of political advertisements.

But who is paying for all of these ads? Is it legal for nonprofits like NAHB or the U.S. Chamber of Commerce to bankroll them? Didn't campaign finance reform in 2002 (McCain-Feingold legislation) outlaw this type of advocacy?  Which groups can participate in which activities?

A recent Washington Post story clears up some of those questions.

501c Groups: Tax Exempt Advocacy and Charitable Organizations
These groups are unaffected by the McCain-Feingold legislation and are governed by the Internal Revenue Service (IRS), not the Federal Election Commission (FEC). These groups are not required to disclose their donors. They are, however, not allowed to use corporate or union funds to pay for issue ads during the 60 days before the general election. A complicated list of rules breaks down 501c groups even further.

501c (3) groups can register voters and collect tax-deductible donations.
501c (3) groups cannot engage in partisan or electioneering work.
501c (4), (5) and (6) groups can be involved in elections, but the cost of their involvement must be less than half of the group's budget.
501c (4), (5) and (6) groups cannot tell people to vote for or against a specific candidate.

527 Groups: Tax-Exempt Organizations with a Political Mission
527 groups are also governed by the IRS. Unlike 501c's however, 527's must report their contributors and expenditures to the IRS. FEC reporting is also required, if the 527 is a political party or PAC expressly advocating the election or defeat of a federal candidate.  You often see these groups behind political activities like voter mobilization efforts and issue ads.   [ return to top ]