Nonprofit organizations can follow some simple guidelines to decide whether lobbying might hurt their tax-exempt status, The Wall Street Journal reported August 9.
The Journal cited a recent “informational letter” from the Internal Revenue Service to a lobbying arm of Independent Sector, a nonprofit trade group in Washington, D.C., that offers two general rules for lobbying by nonprofits, excluding churches.
Lobbying should make up “no substantial part” of a group’s activities, the IRS says, warning that nonprofits can get into trouble because “few definitions exist under this standard.”
The IRS also cites its sliding scale based on specific “dollar-based safe harbors that generally permit significantly more lobbying,” the Journal says.
The scale is based on a group’s annual budget and allows spending up to $1 million on total lobbying and up to $250,000 on grass-roots lobbying.
“This lays out in one-syllable words what charities can do,” Thomas Troyer, a partner in the Washington, D.C., law firm Caplin & Drysdale told the Journal.