Politics and Nonprofits: Wagenmaker & Oberly Partner Cited in Recent News Article

The Chicago-area Northwest Herald recently ran an article highlighting the problems that 501(c)(3) organizations face if they become involved in political advocacy.  The subject of the article, a charitable organization that delivers services to young adults with substance abuse problems, has come under scrutiny due to allegations of illegal politicking.  According to the article, the public charity actively promoted political candidates on its Facebook page.  

The article cites Ryan Oberly, one of the partners at Wagenmaker & Oberly, to   explain the rule:  “There is an absolute prohibition on intervening in political campaigns, such as activities for or against a particular candidate.  It goes way beyond funding a candidate.” Indeed, any activity intended to influence a political campaign is strictly off-limits for 501c3 organizations.  Because violations of this prohibition may result in significant penalties, not only for the organization but also for officers and directors, nonprofit leaders need to be aware of the limitations imposed on their exempt organizations.

That’s the Ticket! “Suggested Donations,” Admission Fees, and the Real Price of Tax-Exempt Status

Everyone loves a great deal.  Except, perhaps, the New York Metropolitan Museum of Art these days, and those who aren’t as creative as the Met.  Last week, the Met found itself in hot water for sponsoring a Groupon discount admission coupon, for $7 off the regular $25 “recommended donation” for adults.  Why would anyone need a coupon, if the admission is only suggested, and a tax-deductible “donation” to boot? 

The IRS Advisory Committee on Tax Exempt and Government Entities (“ACT”) recently published its 2013 Report

Apparently, in the midst of IRS struggles to keep up with paperwork, and a huge backlog of 1023 applications, the IRS Advisory Committee on Tax Exempt and Government Entities (“ACT”) has determined that more aggressive oversight on the backend is the key to achieving greater compliance.  According to the IRS committee’s recently published recommendations, small tax-exempt organizations could face heavier annual reporting burdens.