Tuesday, March 2, 2010
A recent report in the Tennessean (Nashville, TN) provides a nice case study regarding the extent to which the Preisdent of a 501(c)(3) is or is speaking on behalf of the 501(c)(3) for purposes of the ban on campaign intervention by a tax exempt charity. The nonprofit organization, Proclaiming Justice to the Nations, had planned on hosting a political fundraiser for U.S. Representative Michele Bachman, until it was suggested that doing would jeopardize the group's tax exempt status. What makes this a pretty good case study of "who is the charity" is that the organization is run out of the CEO's home and, according to the report,the CEO is a staunch supporter of Representative Bachman, who is presently running for re-election. The article details the efforts made by the organization's president to remain a supporter of Bachman without co-mingling the nonprofit's assets into her reelection efforts. Given tht the nonprofit has no separate existence from its President, that's easier said then done. For example, emails sent in support of the reelection campaign come from the same computers used by the nonprofit, and are sent to the same supporters of the nonprofit. It seems almost inevitable that small nonprofits essentially operated by one politically active person will have to deal with the issue raised in this report.