IRS Looks To Further Regulate Political Activity By Tax-Exempt Organizations

Tax-exempt*, or “non-profit,” organizations spend hundreds of millions of dollars on advocacy: “get out the vote campaigns”; candidate forums; legislation; issues; ballot campaigns; and political races, including presidential elections. A new report says come June, the Internal Revenue Service (IRS) might release a draft proposal of new regulations regarding how such groups may operate politically. However, it is doubtful that new rules would be in place before the 2016 presidential election, in part due to IRS desire to avoid any appearance of an attempt to influence the outcome of that race.

According to a May 27 IRS press release, the agency will hold a public meeting on June 27. Members of the Advisory Committee on Tax Exempt and Government Entities (ACT) will present reports and recommendations to senior IRS officials. However, it is unclear if this meeting will focus at all upon political activity by tax-exempts.

For those of us advocating for artists’ rights and the creative economy, any and all political activity is worth our notice, especially when it is funded by millions of dollars. MALC will keep you informed of any proposed regulations that may impact the advocacy/political work of tax-exempt organizations.

*There are many classifications of tax-exempt non-profits. 501(c)3 organizations may lobby elected officials regarding policy and legislation. However, they are prohibited from endorsing or opposing political candidates. 501(c)4 organizations may directly support or oppose candidates.