BOLDERADVOCACY
wo
What is Lobbying Under the 501(h) Election?
Federal tax law controls how much lobbying 501(c)(3) organizations can engage in. Public charities
can choose to measure their lobbying under either the insubstantial part test or the 501(h) expenditure
test. While lobbying is not defined under the insubstantial part test, this fact sheet provides an
overview of how lobbying is defined for organizations that measure their lobbying under the 501(h)
expenditure test.
Lobbying
Direct Lobbying Grassroots Lobbying
Communication Communication
with a Legislator with the Public
that Expresses a View about Specific that Expresses a View about Specific
Legislation Legislation
and includes a Call to Action
In order for an action to be considered direct lobbying or grassroots lobbying it must contain all of the
above elements. It is not lobbying if one or more of the required elements is missing. Understanding
the meaning of each elementis key.
Communication: A conversation (in person or by phone), letter, email, fax, or other creative
mechanism to convey a message.
Legislator: A member of a legislative body or her staff. In addition, executive branch officials who
participate in the formulation of legislation are considered legislators (such as the governor or mayor
when vetoing a bill or an agency secretary when helping the legislature write a bill). Members of
administrative bodies, however, such as school boards, sewer and water districts, housing authorities,
zoning boards, and other special purposes bodies, whether elected or appointed, are not considered
legislators.
Public: Anyone but a legislator or member of an organization. Communications to an organization's
members are treated more favorably, so a communication to an organization’s members that urges
them to contact legislators to express a view about specific legislation is considered to be direct
lobbying. For this purpose, a member is someone who has given more than a small amount of time
or money to the organization.
Expresses a view about specific legislation: A bill or resolution that has been introduced in a
legislative body or a specific proposal to solve a problem. Specific legislation includes budget
appropriations and taxes, and attempts to influence the confirmation of judicial and executive branch
nominees. A proposal may qualify as specific legislation even if it has not yet "
1
YL
ALLIANCEjijstice
BOLDERADVOCACY
wo
been introduced, been written down, or even fully fleshed out. Specific legislation does not include
rulemakings / promulgation of regulations, executive orders, litigation, or attempts to enforce existing
laws.
Call to action: A specific means of encouraging the communication’s recipient to take lobbying
action. A call to action must comprise one of the following actions: 1) tell the recipient to contact a
legislator; 2) provide information on how the recipient can contact his legislator, such as providing
the phone number or address; 3) provide a mechanism for enabling the recipient to contact his
legislator, such as a postcard, petition, or email form; or 4) identify a legislator who will vote on the
legislation as being opposed to or undecided about the organization's view on the legislation, a
member of a legislative committee who will vote on the legislation, or the recipient's legislator.
Ballot measure activity is considered direct lobbying. Although ballot measures, such as referenda,
bond measures, and ballot initiatives, are determined at the voting booth, efforts for or against them
are considered direct lobbying, not impermissible electoral activity. Efforts aimed at convincing the
public to support or oppose ballot measures are direct lobbying since the voting public serves as the
legislature.
Not Lobbying
There are four principal exceptions to these definitions. Any communication that meets one of these
exceptions does not count as lobbying:
Nonpartisan analysis, study or research that presents all sides of an issue. The communication
must provide a full and fair exposition of the underlying facts and it must be made available to the
general public, a segment of the general public, or to governmental bodies or employees. The
document should provide enough information to allow readers to draw their own conclusions about
the issue, even if the report itself contains a specific conclusion. For example, an organization might
write a paper discussing the need for access to healthcare by low-income children, which might
conclude with a recommendation for increased funding for state child health insurance.
R to written req for assi: e from committees or other legislative bodies. The
communication must be in response to a written request by a legislative body, committee, or
subcommittee (not an individual legislator), and it must be made available to all members of the
requesting body. As an example, the executive director of a public charity, in response to a written
request from the chair of a legislative committee, could testify in support of a clean indoor air bill,
without counting the expenses toward the organization's lobbying limits.
Challenges to or support for legislative proposals that would change the organization’s rights
or its right to exist. The communication must be with a legislative body regarding possible actions of
that body which could affect the organization's existence, powers, duties, tax-exempt status, or the
deductibility of contributions to the organization. For instance, proposed legislation to eliminate the
tax-deductibility of contributions to 501(c)(3) organizations would fall within the so-called “self-
defense” exception.
E inati and of broad social, economic, and similar problems.
Communications on general topics which are also the subject of specific §
2
YL
ALLIANCEjijstice
4 BOLDERADVOCACY
legislation must not refer to specific legislation or directly encourage the recipients to take action.
The information contained in this fact sheet and any attachments is being provided for informational purposes only and not
as part of an attorney-client relationship. The information is not a substitute for expert legal, tax, or other professional advice
tailored to your specific circumstances, and may not be relied upon for the purposes of avoiding any penalties that may be
imposed under the Internal Revenue Code. Alliance for J ustice publishes plain-language guides on nonprofit advocacy
topics, offers educational workshops on the laws governing the advocacy of nonprofits, and provides technical assistance for
nonprofits engaging in advocacy. For additional information, please feel free to contact Alliance for J ustice at 866-NPLOBBY.
www.bolderadvocacy.org | www.allianceforjustice.org
: \
con
ALLIANCE }jijstice
