Many non profits avoid lobbying because they believe that they are prohibited by law from lobbying, or are unclear or confused about lobbying regulations, or fear that lobbying will jeopardize their tax exempt status from the Internal Revenue Service.
The short answer to the question “Can non profits lobby?” is yes – as long as federal funds are not used to pay for lobbying activities.
However, non profit organizations that are designated by the IRS as tax exempt, charitable organizations under section 501 (c)(3) of the Internal Revenue Code should be aware of two regulations that govern its lobbying activities.
- A non profit, 501 (c)(3) organization may elect to fall under the 1976 lobby law. Generally, organizations that elect the 1976 lobby law may spend 20% of the first $500,000 of their annual expenditures on lobbying ($100,000), 15% of the next $500,000, and so on, up to $1 million dollars – without jeopardizing their tax exempt status.
- An organization that does not elect to fall under the 1976 lobby law, must follow the IRS guideline that its lobbying activities must be “insubstantial.” Unfortunately, the IRS does not clearly define “insubstantial,” making it difficult for organizations to be certain how much they may spend on lobbying.
Whether or not to elect to come under the 1976 lobby law is a matter that should be discussed with the organization's accounting and legal resources.
Charity Lobbying in the Public Interest. http://www.clpi.org/right_thing.html.
