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Political activity by a Church can jeopardize its tax-exempt status under IRC § 501(c)(3).
Partisan Campaign Support or Opposition Prohibited:
A church, as a tax-exempt organization under Internal Revenue Code (“IRC”) § 501(c)(3), is absolutely prohibited from directly or indirectly participating or intervening in any political campaign in support or opposition to any candidate for elective public office. See Treasury Regulation §1.501(c)(3)---1(c)(3)(iii).
This prohibition applies to all national (federal), state, or local elective public office campaigns.
See IRS Revenue Ruling 2007-41 (provides concise summary of law, factors, and 21 situational factual examples covering a wide range of issues within this topic).
Note: A church pastor or minister may mention a candidate or a near future election but may not speak in favor of (or encourage the congregation to vote for or against) a particular candidate.
Consequences or Penalty for Violations of Campaign Advocacy Silencing Laws:
Even a single violation of this law could result in an expensive IRS challenge to (and possible loss of) the church’s tax exemption status.
But, rarely does a violation result in losing tax exempt status. But it can happen. More frequently, certain tax and other penalties are imposed (example 10% excise tax on the improper expenditure jumping to 100% for failing to correct the violation. Individuals can be penalized as well (See IRC §4955).
Written Political Campaign Policy Recommended:
Therefore, in order to help minimize this risk, it is recommended that a Christian or other church have and implement written political campaign policy, mention their position in their bylaws, and train and educate their people regarding the law.
Once the policy is in place, the officers, directors, elders, pastors, clergy, deacons, employees, and volunteers need to closely hold fast to the Policy.
For example, the policy should state that it is unlawful for them to engage in any partisan political activity during work hours.
Further, they may not use any of the church corporation's resources for the benefit, support, or opposition of a political party or political candidate. This includes, for example, telephones, faxes, email, mailing lists, offices, sanctuaries, and meeting rooms.
Any policy should provide that any actual or possible impermissible actions be reported immediately in writing to the church corporate secretary to be reviewed by the Board of Directors / Elder Board. If the Board determines that reasonable cause exists that the action violate the law, corrections shall be made. Further, the violating individual(s) shall be subject to disciplinary procedures including warnings, suspension, or termination.
Freedom to Campaign in Individual Capacity:
The law does allow free expression on political matters by individuals speaking for themselves outside the scope of their work for the church corporation. On their own time, they may speak or write for or donate to a particular candidate. They may go to campaign events on their own time. But, when speaking or writing in an individual capacity, great care and effort ought to be taken to communicate that the actions and/or comments are personal and are not intended to represent the views of the church.
Examples of Prohibited Activities:
1. Publicly endorsing or opposing a particular candidate or political party in any written or verbal publication or correspondence;
2. Using a church fax machine telephone number or email address to disseminate biased partisan or candidate information;
3. Providing for only one candidate (to the exclusion of others) by selling a mailing list, leasing office space, or accepting paid political advertisements.
4. Links on the Corporation's website that lead to partisan or candidate-related material contained on other websites;
5. Funding political-candidates, partisan organizations, or other organized efforts to influence a political election.
6. For more examples and information, review IRS Fact Sheet-2006-17 and IRS Rev. Ruling 2007-41 which can be found at www.irs.gov.
Non-Partisan Activities Allowed:
A tax-exempt church can engage in certain non-partisan, educational activities related to political elections such as public forums, candidate debates, voter registration initiatives, or other voter-education activities. But, of course, such activities ought to be carefully planned in order to avoid any actual or perceived bias. Make sure that the Board of Directors / Elder Board approves same before starting same.
Neutral Voter Education Permitted:
Religious entities and churches may create or distribute voter guides, conduct voter registration drives and conduct candidate forums or debates as long as they do so in a "fair and impartial". "nonpartisan" manner. Rev. Rul. 2007-41 (provides examples and law summary). Rev. Rul. 86-95. See also Rev. Rul. 78-248 (provides examples); Rev. Rul. 80-282 (timing and distribution of voter education materials); IRS Publ. 1828, pp. 8-9; FS-2006-17.
Limited Legislative Lobbying Permitted:
Note: Nonprofit churches may engage in a very limited amount of legislative lobbying. See Treasury Regulation §1.501(c)(3)---1(c)(3)(i). They CAN speak up, advocate, and disseminate education information about critical moral, economic and other ISSUES.
can seek to
influence legislation, can urge people to contact their government
and directly contact lawmakers. Prayer vigils can be utilized. But the
must remain primarily engaged in its tax exempt purpose. This
lobbying issue is
church should proceed cautiously,
limit the amount of time and money spent, and utilize experienced legal
in this regard.
Political Candidates May Be Conditionally Invited to Speak at Churches:
Further note, the IRS recognizes that political candidates may be involved in the community. Thus, a candidate can be invited to the church to be a feature speaker. But he or she should be clearly instructed in writing that he or she: (1) Can speak only in a non-candidate capacity, (2) Not mention of the candidacy or election;and (3)not engage any any campaign activity. The event itself should have an entirely non-partisan tone.
Constitutionality of Anti-Campaigning Laws:
Some are now again questioning whether such prohibition is constitutional. The courts may be called on to further sort out this issue as certain churches and nonprofit organizations seek legal redress from such free speech and religion restrictions based on First Amendment and other legal principles.
As Christians, we are seek God’s wisdom regarding this issue (Proverbs 4:7, 3:13-15, 2:6; James 1:5). Christian churches should consider exercising their rights to prudently participate in the political process to the full extent that the law allows them to. Further, some will grapple whether they should choose a path that allows to be silenced as to campaign advocacy in exchange for a tax-exempt status.
See related article: Contact Your Government Officials
Please feel free to contact Christian lawyer, Matthew B. Tozer for a free initial consultation.
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