Nonprofit Governance Department
The Issue
501(c)(3) organizations are permitted to engage in Lobbying and Advocacy but strictly prohibited from engaging in campaign intervention. Navigating what these terms means can often be tricky.
The federal government limits and regulates a nonprofit organization’s ability to engage in political activity. There are three types of regulated political activity, and every nonprofit should be mindful of their level of engagement in each: 1) campaign intervention, 2) lobbying, and 3) issue advocacy.
Campaign intervention is defined as taking any action in support of or in opposition to a candidate for public office. 501(c)(3) entities are strictly prohibited from engaging in this type of political activity. Campaign intervention includes direct or indirect communication with a candidate or their staff, public communications which indicate support or opposition to a candidate, events or activities designed to benefit a candidate, and any use of the organization’s resources in support of or opposition to a candidate. It is important to ensure that no employees, officers, or directors are using the organization’s resources to promote or oppose a candidate. This use could be in the form of a facility, a laptop, or even a mailing list. Having a written policy in place governing campaign intervention will allow nonprofit staff to be mindful of the strictness of this regulation.
There are two types of lobbying which 501(c)(3) organizations are permitted to engage in, in a limited way. The first is direct lobbying, which is the act of contacting legislators or their staff in support of or opposition to specific policies or legislation. The second is grassroots lobbying, which is urging the public to support or oppose specific policies or legislation. While a 501(c)(3) is permitted to lobby all lobbying activities must be directly related to the nonprofit purpose of the organization. For example, if a nonprofit exists to promote environmental conservation, it can lobby legislators in support of a bill to regulate greenhouse gas emissions, but not a bill which addresses labor safety. A nonprofit can also provide legislators policy papers and other materials addressing specific policies or legislation. Lobbying also cannot be a substantial part of how a 501(c)(3) uses its resources. The IRS has not defined what “substantial part” means, however as a rule of thumb no more than 10-12% of an organization’s resources should be used for lobbying activities.
Finally, the third type of political activity a 501(c)(3) is permitted to engage in is advocacy. Advocacy is the act of educating the public about specific issues relevant to the people an organization represents, or in furtherance of a nonprofit’s purpose. There is no limit to the amount of advocacy a 501(c)(3) can engage in, as long as it does so within the scope of its purpose. Examples of advocacy include meeting with members of congress to explain how a cause affects a particular group and using resources to educate the public about a cause or issue. The difference between advocacy and lobbying is the scope of its focus. Advocacy has a broad focus and refers to the general act of supporting or promoting a cause, issue, or idea. The goal is to raise awareness, and influence public opinion, and not necessarily aimed at legislative action.
