An important issue is the federal tax code's rule against 501(c)(3) organizations engaging in political and legislative activities. Because the proscribed activities violate the tax code (and may result in the revocation of the organization's tax-exempt status, the imposition of an excise tax, and liability for back taxes), you must understand how 501(c)(3) defines each type of activity.

a. Political activity

Political activity refers to direct or indirect participation in any political campaign for elected public office. The focus is the partisan nature of the activity. Some guidelines:

• You may not, on behalf of your organization, make a contribution to campaign funds, or issue a public statement in favor of or in opposition to a candidate for public office.
• You may engage in issue advocacy, including that which differentiates candidates running for public office, as long as you do not favor or oppose a candidate.
• You may, on behalf of your organization, engage in nonpartisan activities that focus on the electoral process, such as publishing voter education guides and voter registration, so long as they do not favor one candidate over another.

Deciding whether or not any particular activity is prohibited "political activity" may often require some difficult line drawing. Refer to the IRS' Revenue Ruling 2007-41 for more information. The Revenue Ruling outlines 21 scenarios and explains why each situation does or does not run afoul of the ban on political campaign intervention.

b. Legislative activity

Legislative activity refers to attempts to influence legislation, popularly known as lobbying. While the prohibition discussed above bars any political activity supporting or opposing a candidate running for office, the prohibition on legislative activity is more nuanced. No "substantial part" of a 501(c)(3) organization's activities may be devoted to lobbying.

Influencing legislation includes any of the following activities:

• support of or opposition to legislation
• direct contact with members of a legislative body
• urging the public, or a segment of the public, to contact members of a legislative body

The focus is on influencing legislation and legislative bodies, like Congress or a state legislature, and not on influencing executive, judicial, or administrative bodies. However, the prohibition against political activity applies to these arenas as well. For example, a nonprofit organization may not endorse or oppose candidates running for judicial office. Refer to the IRS Publication on Lobbying which lists detailed examples of legislative activities.

At this point you may be asking yourself: what exactly can I do without jeopardizing my 501(c)(3) status? You may author and publish:

• studies, research, or analysis performed by nonpartisan entities
• articles disucssing issues of public policy in an educational manner, which according to the tax code means presenting "a sufficiently full and fair exposition of [the] pertinent facts as to permit an individual or the public to form an independent opinion or conclusion”
• your own views, in a manner clearly separate from those of the organization

Neither the bar on political activity nor the ban on legislative activity can restrain your right of free expression. However, the right of free expression is guaranteed to you and not your nonprofit organization. Consequently, when you make these types of statements, you should be clear that your comments are personal to you and are not representative of the nonprofit organization.

This area of law is complex. In particular, determining whether your writing is "political activity" or "issue advocacy" requires difficult and fact-sensitive analysis. In addition, figuring out whether a particular lobbying activity involves a "substantial part" of your organization's overall activity is challenging. Given the penalties for violating these prohibitions, you should seek a lawyer's assistance when deciding whether to undertake activities that seem borderline.