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501(c)(3) organization

From Wikipedia, in a visual modern way

A 501(c)(3) organization is a United States corporation, trust, unincorporated association or other type of organization exempt from federal income tax under section 501(c)(3) of Title 26 of the United States Code. It is one of the 29 types of 501(c) nonprofit organizations[1] in the US.

501(c)(3) tax-exemptions apply to entities that are organized and operated exclusively for religious, charitable, scientific, literary or educational purposes, for testing for public safety, to foster national or international amateur sports competition, or for the prevention of cruelty to children or animals. 501(c)(3) exemption applies also for any non-incorporated community chest, fund, cooperating association or foundation organized and operated exclusively for those purposes.[2][1] There are also supporting organizations—often referred to in shorthand form as "Friends of" organizations.[3][4][5][6][7]

26 U.S.C. § 170 provides a deduction for federal income tax purposes, for some donors who make charitable contributions to most types of 501(c)(3) organizations, among others. Regulations specify which such deductions must be verifiable to be allowed (e.g., receipts for donations of $250 or more).

Due to the tax deductions associated with donations, loss of 501(c)(3) status can be highly challenging if not fatal to a charity's continued operation, as many foundations and corporate matching funds do not grant funds to a charity without such status, and individual donors often do not donate to such a charity due to the unavailability of tax deduction for contributions.[8]

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501(c) organization

501(c) organization

A 501(c) organization is a nonprofit organization in the federal law of the United States according to Internal Revenue Code and is one of over 29 types of nonprofit organizations exempt from some federal income taxes. Sections 503 through 505 set out the requirements for obtaining such exemptions. Many states refer to Section 501(c) for definitions of organizations exempt from state taxation as well. 501(c) organizations can receive unlimited contributions from individuals, corporations, and unions.

Charitable organization

Charitable organization

A charitable organization or charity is an organization whose primary objectives are philanthropy and social well-being.

Literature

Literature

Literature is any collection of written work, but it is also used more narrowly for writings specifically considered to be an art form, especially prose fiction, drama, and poetry. In recent centuries, the definition has expanded to include oral literature, much of which has been transcribed. Literature is a method of recording, preserving, and transmitting knowledge and entertainment, and can also have a social, psychological, spiritual, or political role.

Education

Education

Education is a purposeful activity directed at achieving certain aims, such as transmitting knowledge or fostering skills and character traits. These aims may include the development of understanding, rationality, kindness, and honesty. Various researchers emphasize the role of critical thinking in order to distinguish education from indoctrination. Some theorists require that education results in an improvement of the student while others prefer a value-neutral definition of the term. In a slightly different sense, education may also refer, not to the process, but to the product of this process: the mental states and dispositions possessed by educated people. Education originated as the transmission of cultural heritage from one generation to the next. Today, educational goals increasingly encompass new ideas such as the liberation of learners, skills needed for modern society, empathy, and complex vocational skills.

Amateur sports

Amateur sports

Amateur sports are sports in which participants engage largely or entirely without remuneration. The distinction is made between amateur sporting participants and professional sporting participants, who are paid for the time they spend competing and training. In the majority of sports which feature professional players, the professionals will participate at a higher standard of play than amateur competitors, as they can train full-time without the stress of having another job. The majority of worldwide sporting participants are amateurs.

Child abuse

Child abuse

Child abuse is physical, sexual, and/or psychological maltreatment or neglect of a child or children, especially by a parent or a caregiver. Child abuse may include any act or failure to act by a parent or a caregiver that results in actual or potential harm to a child and can occur in a child's home, or in the organizations, schools, or communities the child interacts with.

Cruelty to animals

Cruelty to animals

Cruelty to animals, also called animal abuse, animal neglect or animal cruelty, is the infliction by omission (neglect) or by commission by humans of suffering or harm upon non-human animals. More narrowly, it can be the causing of harm or suffering for specific achievements, such as killing animals for entertainment; cruelty to animals sometimes encompasses inflicting harm or suffering as an end in itself, referred to as zoosadism.

Community Chest (organization)

Community Chest (organization)

Community Chests, commonly referred to as community trusts, community foundations and united way organizations, are endowment funds pooled from a community for the purpose of charitable giving. The first Community Chest, "Community Fund", was founded in 1913 in Cleveland, Ohio, by the Federation for Charity and Philanthropy. The number of Community Chest organizations increased from 39 to 353 between 1919 and 1929, and surpassed 1,000 by 1948. By 1963, and after several name changes, the term "United Way" was adopted in the United States, whereas the United Way/Centraide name was not adopted in Canada until 1973–74.

Cooperating Associations

Cooperating Associations

Cooperating Associations, also known as interpretive associations or natural history associations, support the interpretive, educational and scientific programs and services of governmental land management agencies such as the National Park Service, USDA Forest Service, US Fish and Wildlife Service, Bureau of Land Management, US Army Corps of Engineers, or state park departments.

Internal Revenue Code

Internal Revenue Code

The Internal Revenue Code (IRC), formally the Internal Revenue Code of 1986, is the domestic portion of federal statutory tax law in the United States, published in various volumes of the United States Statutes at Large, and separately as Title 26 of the United States Code (USC). It is organized topically, into subtitles and sections, covering income tax in the United States, payroll taxes, estate taxes, gift taxes, and excise taxes; as well as procedure and administration. The Code's implementing federal agency is the Internal Revenue Service.

Charitable contribution deductions in the United States

Charitable contribution deductions in the United States

Charitable contribution deductions for United States Federal Income Tax purposes are defined in section 170(c) of the Internal Revenue Code as contributions to or for the use of certain nonprofit enterprises.

Matching funds

Matching funds

Matching funds are funds that are set to be paid in proportion to funds available from other sources. Matching fund payments usually arise in situations of charity or public good. The terms cost sharing, in-kind, and matching can be used interchangeably but refer to different types of donations.

Types

The two exempt classifications of 501(c)(3) organizations are as follows:

  • A public charity, identified by the Internal Revenue Service (IRS) as "not a private foundation", normally receives a substantial part of its income, directly or indirectly, from the general public or from the government. The public support must be fairly broad, not limited to a few individuals or families. Public charities are defined in the Internal Revenue Code under sections 509(a)(0) through 509(a)(4).[9]
  • A private foundation, sometimes called a non-operating foundation, receives most of its income from investments and endowments. This income is used to make grants to other organizations, rather than being disbursed directly for charitable activities. Private foundations are defined in the Internal Revenue Code under section 509(a) as 501(c)(3) organizations, which do not qualify as public charities.[10][11]

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Internal Revenue Service

Internal Revenue Service

The Internal Revenue Service (IRS) is the revenue service for the United States federal government, which is responsible for collecting U.S. federal taxes and administering the Internal Revenue Code, the main body of the federal statutory tax law. It is an agency of the Department of the Treasury and led by the Commissioner of Internal Revenue, who is appointed to a five-year term by the President of the United States. The duties of the IRS include providing tax assistance to taxpayers; pursuing and resolving instances of erroneous or fraudulent tax filings; and overseeing various benefits programs, including the Affordable Care Act.

Internal Revenue Code

Internal Revenue Code

The Internal Revenue Code (IRC), formally the Internal Revenue Code of 1986, is the domestic portion of federal statutory tax law in the United States, published in various volumes of the United States Statutes at Large, and separately as Title 26 of the United States Code (USC). It is organized topically, into subtitles and sections, covering income tax in the United States, payroll taxes, estate taxes, gift taxes, and excise taxes; as well as procedure and administration. The Code's implementing federal agency is the Internal Revenue Service.

Private foundation (United States)

Private foundation (United States)

Until 1969, the term private foundation was not defined in the United States Internal Revenue Code. Since then, every U.S. charity that qualifies under Section 501(c)(3) of the Internal Revenue Service Code as tax-exempt is a "private foundation" unless it demonstrates to the IRS that it falls into another category such as public charity. Unlike nonprofit corporations classified as a public charity, private foundations in the United States are subject to a 1.39% excise tax or endowment tax on any net investment income.

Obtaining status

The basic requirement of obtaining tax-exempt status is that the organization is specifically limited in powers to purposes that the IRS classifies as tax-exempt purposes. Unlike for-profit corporations that benefit from broad and general purposes, non-profit organizations need to be limited in powers to function with tax-exempt status, but a non-profit corporation is by default not limited in powers until it specifically limits itself in the articles of incorporation or nonprofit corporate bylaws. This limiting of the powers is crucial to obtaining tax exempt status with the IRS and then on the state level.[12] Organizations acquire 501(c)(3) tax exemption by filing IRS Form 1023.[13] As of 2006, the form must be accompanied by an $850 filing fee if the yearly gross receipts for the organization are expected to average $10,000 or more.[14][15] If yearly gross receipts are expected to average less than $10,000, the filing fee is reduced to $400.[14][15] There are some classes of organizations that automatically are treated as tax exempt under 501(c)(3), without the need to file Form 1023:

  • Churches, their integrated auxiliaries, and conventions or associations of churches. A convention or association of churches generally refers to the organizational structure of congregational churches.[16] A convention or association of churches can also refer to a cooperative undertaking of churches of various denominations that works together to perform religious activities.[17][18]
  • Organizations that are not private foundations and that have gross receipts that normally are not more than $5,000[19]

The IRS released a software tool called Cyber Assistant in 2013, which was succeeded by Form 1023-EZ in 2014.

There is an alternative way for an organization to obtain status if an organization has applied for a determination and either there is an actual controversy regarding a determination or the Internal Revenue Service has failed to make a determination. In these cases, the United States Tax Court, the United States District Court for the District of Columbia, and the United States Court of Federal Claims have concurrent jurisdiction to issue a declaratory judgment of the organization's qualification if the organization has exhausted administrative remedies with the Internal Revenue Service.[20][21]

Prior to October 9, 1969, nonprofit organizations could declare themselves to be tax-exempt under Section 501(c)(3) without first obtaining Internal Revenue Service recognition by filing Form 1023 and receiving a determination letter.[22] A nonprofit organization that did so prior to that date could still be subject to challenge of its status by the Internal Revenue Service.[22]

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Form 1023

Form 1023

Form 1023 is a United States IRS tax form, also known as the Application for Recognition of Exemption Under 501(c)(3) of the Internal Revenue Code. It is filed by nonprofits to get exemption status. On January 31st of 2020, the IRS abandoned the paper format of the form 1023. Those who used the paper version were given 90 days grace period and that ended on 30th of April 2020. Going forward, every application has to be filed online through Pay.gov portal.

United States Tax Court

United States Tax Court

The United States Tax Court is a federal trial court of record established by Congress under Article I of the U.S. Constitution, section 8 of which provides that the Congress has the power to "constitute Tribunals inferior to the supreme Court". The Tax Court specializes in adjudicating disputes over federal income tax, generally prior to the time at which formal tax assessments are made by the Internal Revenue Service.

United States District Court for the District of Columbia

United States District Court for the District of Columbia

The United States District Court for the District of Columbia is a federal district court in the District of Columbia. It also occasionally handles federal issues that arise in the territory of American Samoa, which has no local federal court or territorial court. Appeals from the District are taken to the United States Court of Appeals for the District of Columbia Circuit.

United States Court of Federal Claims

United States Court of Federal Claims

The United States Court of Federal Claims is a United States federal court that hears monetary claims against the U.S. government. It was established by statute in 1982 as the United States Claims Court, and took its current name in 1992. The court is the successor to trial division of the United States Court of Claims, which was established in 1855.

Concurrent jurisdiction

Concurrent jurisdiction

Concurrent jurisdiction exists where two or more courts from different systems simultaneously have jurisdiction over a specific case. This situation often leads to forum shopping, as parties will try to have their civil or criminal case heard in the court that they perceive will be most favorable to them.

Tax-deductible charitable contributions

Individuals may take a tax deduction on a charitable gift to a 501(c)(3) organization that is organized and operated exclusively for religious, charitable, scientific, literary or educational purposes, or to foster national or international amateur sports competition (but only if no part of its activities involve the provision of athletic facilities or equipment), or for the prevention of cruelty to children or animals.[23]

An individual may not take a tax deduction on gifts made to a 501(c)(3) organization that is organized and operated exclusively for the testing for public safety.[24]

In the case of tuition fees paid to a private 501(c)(3) school or a church school, the payments are not tax-deductible charitable contributions because they are payments for services rendered to the payee or the payee's children.[25][26][27] The payments are not tax-deductible charitable contributions even if a significant portion of a church school's curriculum is religious education.[28][29] For a payment to be a tax-deductible charitable contribution, it must be a voluntary transfer of money or other property with no expectation of procuring financial benefit equal to the transfer amount.[30]

Before donating to a 501(c)(3) organization, a donor can consult the searchable online IRS list of charitable organizations to verify that the organization qualifies to receive tax-deductible charitable contributions.[31]

Consumers may file IRS Form 13909, with documentation, to complain about inappropriate or fraudulent (i.e., fundraising, political campaigning, lobbying) activities by any 501(c)(3) organization.[32]

Most 501(c)(3) must disclose the names and addresses of certain large donors to the Internal Revenue Service on their annual returns, but this information is not required to be made available to the public,[33] unless the organization is an independent foundation.[34] Churches are generally exempt from this reporting requirement.[35]

Transparency

All 501(c)(3) organizations must make available for public inspection its application for tax-exemption, including its Form 1023 or Form 1023-EZ and any attachments, supporting documents, and follow-up correspondence with the Internal Revenue Service.[36] The same public inspection requirement applies to the organization's annual return, namely its Form 990, Form 990-EZ, Form 990-PF, Form 990-T, and Form 1065, including any attachments, supporting documents, and follow-up correspondence with the Internal Revenue Service, with the exception of the names and addresses of donors on Schedule B.[36][37] Annual returns must be made publicly available for a three-year period beginning with the due date of the return, including any extension of time for filing.[36][37]

The Internal Revenue Service provides information about specific 501(c)(3) organizations through its Tax Exempt Organization Search online.[38][39]

A private nonprofit organization, GuideStar, provides information on 501(c)(3) organizations.[40][41]

ProPublica's Nonprofit Explorer provides copies of each organization's Form 990 and, for some organizations, audited financial statements.[42]

Open990 is a searchable database of information about organizations over time.[43]

WikiCharities, a nonprofit organization, is a growing global database that allows nonprofits and charities to be searchable by name, location, and topic. [44] WikiCharities also gives each nonprofit a personalized webpage where nonprofits can improve transparency by listing updated contact information, leadership, board members, financials, annual reports, project activities, and more. [45]

Limitations on political activity

Section 501(c)(3) organizations are prohibited from supporting political candidates, as a result of the Johnson Amendment enacted in 1954.[46] Section 501(c)(3) organizations are subject to limits on lobbying, having a choice between two sets of rules establishing an upper bound for their lobbying activities. Section 501(c)(3) organizations risk loss of their tax-exempt status if these rules are violated.[47][48] An organization that loses its 501(c)(3) status due to being engaged in political activities cannot subsequently qualify for 501(c)(3) status.[49]

Churches

Churches must meet specific requirements to obtain and maintain tax-exempt status; these are outlined in "IRS Publication 1828: Tax Guide for Churches and Religious Organizations".[50] This guide outlines activities allowed and not allowed by churches under the 501(c)(3) designation.[50]

In 1980, the United States District Court for the District of Columbia recognized a 14-part test in determining whether a religious organization is considered a church for the purposes of the Internal Revenue Code:

  1. A distinct legal entity;
  2. A recognized creed and form of worship;
  3. A definite and distinct ecclesiastical government;
  4. A formal code of doctrine and discipline;
  5. A distinct religious history;
  6. A membership not associated with any other church or denomination;
  7. A complete organization of ordained ministers ministering to their congregations;
  8. Ordained ministers selected after completed prescribed courses of study;
  9. Literature of its own;
  10. Established places of worship;
  11. Regular congregations;
  12. Regular religious services;
  13. Sunday schools for the religious instruction of the young;
  14. Schools for the preparation of its ministers.

Having an established congregation served by an organized ministry is of central importance.[51] Points 4, 6, 8, 11, 12, and 13 are also especially important. Nevertheless, the 14-point list is a guideline; it is not intended to be all-encompassing, and other relevant facts and circumstances may be factors.[51]

Although there is no definitive definition of a church for Internal Revenue Code purposes, in 1986 the United States Tax Court said that "A church is a coherent group of individuals and families that join together to accomplish the religious purposes of mutually held beliefs. In other words, a church's principal means of accomplishing its religious purposes must be to assemble regularly a group of individuals related by common worship and faith."[52][53] The United States Tax Court has stated that, while a church can certainly broadcast its religious services by radio, radio broadcasts themselves do not constitute a congregation unless there is a group of people physically attending those religious services.[54] A church can conduct worship services in various specific locations rather than in one official location.[55] A church may have a significant number of people associate themselves with the church on a regular basis, even if the church does not have a traditional established list of individual members.[55]

In order to qualify as a tax-exempt church, church activities must be a significant part of the organization's operations.[56][57]

An organization whose operations include a substantial nonexempt commercial purposes, such as operating restaurants and grocery stores in a manner consistent with a particular religion's religious beliefs does not qualify as a tax-exempt church.[58]

Political campaign activities

Organizations described in section 501(c)(3) are prohibited from conducting political campaign activities to intervene in elections to public office.[59] The Internal Revenue Service website elaborates on this prohibition:[59]

Under the Internal Revenue Code, all section 501(c)(3) organizations are absolutely prohibited from directly or indirectly participating in, or intervening in, any political campaign on behalf of (or in opposition to) any candidate for elective public office. Contributions to political campaign funds or public statements of position (verbal or written) made on behalf of the organization in favor of or in opposition to any candidate for public office clearly violate the prohibition against political campaign activity. Violating this prohibition may result in denial or revocation of tax-exempt status and the imposition of certain excise taxes.

Certain activities or expenditures may not be prohibited depending on the facts and circumstances. For example, certain voter education activities (including presenting public forums and publishing voter education guides) conducted in a non-partisan manner do not constitute prohibited political campaign activity. In addition, other activities intended to encourage people to participate in the electoral process, such as voter registration and get-out-the-vote drives, would not be prohibited political campaign activity if conducted in a non-partisan manner.

On the other hand, voter education or registration activities with evidence of bias that (a) favor one candidate over another, (b) oppose a candidate in some manner, or (c) favor a candidate or group of candidates, constitute prohibited participation or intervention.

Constitutionality

Since section 501(c)(3)'s political-activity prohibition was enacted, "commentators and litigants have challenged the provision on numerous constitutional grounds," such as freedom of speech, vagueness, and equal protection and selective prosecution.[60] Historically, Supreme Court decisions, such as Regan v. Taxation with Representation of Washington, suggested that the Court, if it were to squarely examine the political-activity prohibition of § 501(c)(3), would uphold it against a constitutional challenge.[60] However, some have suggested that a successful challenge to the political activities prohibition of Section 501(c)(3) might be more plausible in light of Citizens United v. FEC.[61]

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Political campaign

Political campaign

A political campaign is an organized effort which seeks to influence the decision making progress within a specific group. In democracies, political campaigns often refer to electoral campaigns, by which representatives are chosen or referendums are decided. In modern politics, the most high-profile political campaigns are focused on general elections and candidates for head of state or head of government, often a president or prime minister.

Election

Election

An election is a formal group decision-making process by which a population chooses an individual or multiple individuals to hold public office.

Freedom of speech in the United States

Freedom of speech in the United States

In the United States, freedom of speech and expression is strongly protected from government restrictions by the First Amendment to the United States Constitution, many state constitutions, and state and federal laws. Freedom of speech, also called free speech, means the free and public expression of opinions without censorship, interference and restraint by the government. The term "freedom of speech" embedded in the First Amendment encompasses the decision what to say as well as what not to say. The Supreme Court of the United States has recognized several categories of speech that are given lesser or no protection by the First Amendment and has recognized that governments may enact reasonable time, place, or manner restrictions on speech. The First Amendment's constitutional right of free speech, which is applicable to state and local governments under the incorporation doctrine, prevents only government restrictions on speech, not restrictions imposed by private individuals or businesses unless they are acting on behalf of the government. However, It can be restricted by time, place and manner in limited circumstances. Some laws may restrict the ability of private businesses and individuals from restricting the speech of others, such as employment laws that restrict employers' ability to prevent employees from disclosing their salary to coworkers or attempting to organize a labor union.

Vagueness doctrine

Vagueness doctrine

In American constitutional law, a statute is void for vagueness and unenforceable if it is too vague for the average citizen to understand. This is because constitutionally protected interests cannot tolerate permissible activity to be chilled because of a statute's vagueness. There are several reasons a statute may be considered vague; in general, a statute might be void for vagueness when an average citizen cannot generally determine what persons are regulated, what conduct is prohibited, or what punishment may be imposed. For example, criminal laws which do not state explicitly and definitely what conduct is punishable are void for vagueness. A statute is also void for vagueness if a legislature's delegation of authority to judges or administrators is so extensive that it could lead to arbitrary prosecutions. A law can also be "void for vagueness" if it imposes on First Amendment freedom of speech, assembly, or religion.

Equal Protection Clause

Equal Protection Clause

The Equal Protection Clause is part of the first section of the Fourteenth Amendment to the United States Constitution. The clause, which took effect in 1868, provides "nor shall any State ... deny to any person within its jurisdiction the equal protection of the laws." It mandates that individuals in similar situations be treated equally by the law.

Supreme Court of the United States

Supreme Court of the United States

The Supreme Court of the United States (SCOTUS) is the highest court in the federal judiciary of the United States. It has ultimate appellate jurisdiction over all federal court cases, and over state court cases that involve a point of U.S. Constitutional or federal law. It also has original jurisdiction over a narrow range of cases, specifically "all Cases affecting Ambassadors, other public Ministers and Consuls, and those in which a State shall be Party." The court holds the power of judicial review, the ability to invalidate a statute for violating a provision of the Constitution. It is also able to strike down presidential directives for violating either the Constitution or statutory law. However, it may act only within the context of a case in an area of law over which it has jurisdiction. The court may decide cases having political overtones, but has ruled that it does not have power to decide non-justiciable political questions.

Regan v. Taxation with Representation of Washington

Regan v. Taxation with Representation of Washington

Regan v. Taxation with Representation of Washington, 461 U.S. 540 (1983), was a case in which the United States Supreme Court upheld lobbying restrictions imposed on tax-exempt non-profit corporations.

Citizens United v. FEC

Citizens United v. FEC

Citizens United v. Federal Election Commission, 558 U.S. 310 (2010), was a landmark decision of the Supreme Court of the United States regarding campaign finance laws and free speech under the First Amendment to the U.S. Constitution. It was argued in 2009 and decided in 2010. The court held 5-4 that the free speech clause of the First Amendment prohibits the government from restricting independent expenditures for political campaigns by corporations, including nonprofit corporations, labor unions, and other associations.

Lobbying

Main article: 501(h) election

In contrast to the prohibition on political campaign interventions by all section 501(c)(3) organizations, public charities (but not private foundations) may conduct a limited amount of lobbying to influence legislation. Although the law states that "no substantial part" of a public charity's activities can go to lobbying, charities with large budgets may lawfully expend a million dollars (under the "expenditure" test) or more (under the "substantial part" test) per year on lobbying.[62]

The Internal Revenue Service has never defined the term "substantial part" with respect to lobbying.[63]

To establish a safe harbor for the "substantial part" test, the United States Congress enacted §501(h), called the Conable election after its author, Representative Barber Conable. The section establishes limits based on operating budget that a charity can use to determine if it meets the substantial test. This changes the prohibition against direct intervention in partisan contests only for lobbying. The organization is now presumed in compliance with the substantiality test if they work within the limits. The Conable election requires a charity to file a declaration with the IRS and file a functional distribution of funds spreadsheet with their Form 990. IRS form 5768 is required to make the Conable election.[64]

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501(h) election

501(h) election

A 501(h) election or Conable election is a procedure in United States tax law that allows a 501(c)(3) non-profit organization to participate in lobbying limited only by the financial expenditure on that lobbying, regardless of its overall extent. This allows organizations taking the 501(h) election to potentially perform a large amount of lobbying if it is done using volunteer labor or through inexpensive means. The 501(h) election is available to most types of 501(c)(3) organizations that are not churches or private foundations. It was introduced by Representative Barber Conable as part of the Tax Reform Act of 1976 and codified as 26 U.S.C. § 501(h), and the corresponding Internal Revenue Service (IRS) regulations were finalized in 1990.

Lobbying

Lobbying

In politics, lobbying, persuasion, interest representation, government relations, or government affairs and sometimes legislative relations, legislative affairs, or advocacy, is the act of lawfully attempting to influence the actions, policies, or decisions of government officials, most often legislators or members of regulatory agencies, but also judges of the judiciary. Lobbying, which usually involves direct, face-to-face contact in cooperation with support staff that may not meet directly face-to-face, is done by many types of people, associations and organized groups, including individuals on a personal level in their capacity as private citizens, it is also practiced by corporations in the private sector serving their own interests, by non-profits and non-governmental organizations in the voluntary sector, by fellow legislators or government officials influencing each other through legislative affairs in the public sector, and by advocacy groups. It is also an industry known by many of the aforementioned names, and has a near complete overlap with the public affairs industry. Lobbyists may be among a legislator's constituencies, for example amateur lobbyists such as a voter or a bloc of voters within their electoral district acting as private citizens; while others like professional lobbyists may engage in lobbying as a business or profession. Professional lobbyists are people whose business is trying to influence legislation, regulation, or other government decisions, actions, or policies on behalf of a group or individual who hires them. Individuals and nonprofit organizations can also lobby as an act of volunteering or as a small part of their normal job. Governments often define "lobbying" for legal purposes, and regulate organized group lobbying that has become influential.

Safe harbor (law)

Safe harbor (law)

A safe harbor is a provision of a statute or a regulation that specifies that certain conduct will be deemed not to violate a given rule. It is usually found in connection with a more-vague, overall standard. By contrast, "unsafe harbors" describe conduct that will be deemed to violate the rule.

United States Congress

United States Congress

The United States Congress is the legislature of the federal government of the United States. It is bicameral, composed of a lower body, the House of Representatives, and an upper body, the Senate. It meets in the U.S. Capitol in Washington, D.C. Senators and representatives are chosen through direct election, though vacancies in the Senate may be filled by a governor's appointment. Congress has 535 voting members: 100 senators and 435 representatives. The U.S. vice president has a vote in the Senate only when senators are evenly divided. The House of Representatives has six non-voting members.

Barber Conable

Barber Conable

Barber Benjamin Conable Jr. was a U.S. Congressman from New York and former President of the World Bank Group.

Foreign activities

A 501(c)(3) organization is allowed to conduct some or all of its charitable activities outside the United States.[65][66] A 501(c)(3) organization is allowed to award grants to foreign charitable organizations if the grants are intended for charitable purposes and the grant funds are subject to the 501(c)(3) organization's control.[67] Additional procedures are required of 501(c)(3) organizations that are private foundations.[66][68]

Allowance of tax-deduction by donors

Donors' contributions to a 501(c)(3) organization are tax-deductible only if the contribution is for the use of the 501(c)(3) organization, and that the 501(c)(3) organization is not merely serving as an agent or conduit of a foreign charitable organization.[67] The 501(c)(3) organization's management should review the grant application from the foreign organization, decide whether to award the grant based on the intended use of the funds, and require continuous oversight based on the use of funds.[67]

If the donor imposes a restriction or earmark that the contribution must be used for foreign activities, then the contribution is deemed to be for the foreign organization rather than the 501(c)(3) organization, and the contribution is not tax-deductible.[67]

The purpose of the grant to the foreign organization cannot include endorsing or opposing political candidates for elected office in any country.[67]

Foreign subsidiaries

If a 501(c)(3) organization sets up and controls a foreign subsidiary to facilitate charitable work in a foreign country, then donors' contributions to the 501(c)(3) organization are tax-deductible even if intended to fund the foreign charitable activities.[67][69]

If a foreign organization sets up a 501(c)(3) organization for the sole purpose of raising funds for the foreign organization, and the 501(c)(3) organization sends substantially all contributions to the foreign organization, then donors' contributions to the 501(c)(3) organization are not tax-deductible to the donors.[67]

Source: "501(c)(3) organization", Wikipedia, Wikimedia Foundation, (2023, March 13th), https://en.wikipedia.org/wiki/501(c)(3)_organization.

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Further Reading

Charitable organization

OpenSecrets

Americans United for Separation of Church and State

Private foundation

Form 990

National Center for Charitable Statistics
References
  1. ^ a b IRS Publication 557 "Tax-Exempt Status For Your Organization", Page 19, (Rev. June 2008), Cat. No 46573C., Retrieved March 9, 2009.
  2. ^ "Exempt Purposes – Internal Revenue Code Section 501(c)(3)". irs.gov.
  3. ^ Hopkins, Bruce R. (2011), The Law of Tax-Exempt Organizations (10 ed.), John Wiley and Sons, p. 879, ISBN 978-0-470-60217-1
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