The issue of lobbying by nonprofits has always been a tricky one. Nonprofits do not want to jeopardize either their tax-exempt status or their reputations by engaging in work that is often perceived as less than savory.
Further, grandstanding by politicians and media attention to their pronouncements have made nonprofit decision-makers wary about even engaging in anything that smacks of politicking.
At a recent international nonprofit conference, in a session about advocacy, a panel of nonprofit experts reminded everyone that in fact lobbying by nonprofits is legal, even if it is closely regulated. For instance, under Internal Revenue Code Section 501(h):
It is a myth that 501(c)(3) organizations cannot lobby. The expenditure limits are not severe and extend up to $I million per year for very large organizations.
The law makes it perfectly clear how much can be spent on lobbying if the (h) election is made, and that should be considered a “floor” or “minimum” for those not making the (h) election.
501(c)(3) organizations may support or oppose a bill and encourage their members/supporters to do the same. This is considered lobbying, which is legal. They may also, within certain rules, tell their members/supporters how legislators voted on key issues/legislation.
Grassroots lobbying by 501(c)(3) organizations (encouraging the public to contact legislators) is also permitted but also has a limit of 25 percent of what could be spent under the direct lobbying limit. This does not apply to 501(c)(4) organizations, which may engage in unlimited grassroots lobbying.