Washington (June 14, 2004) - The major political parties are on notice that tax-exempt organizations, including churches, are prohibited from directly or indirectly participating in any political campaign. In a letter to the Democratic National Committee, the Republican National Committee, and the national leadership of the America First, Constitution, Green, Libertarian, and Natural Law parties, the Internal Revenue Service said it would enforce existing rules in the area despite the possibility of change in the law.
“While there is pending legislation that may modify the rules in this area, the Internal Revenue Service is charged by Congress with policing current law and will take whatever actions are necessary to stem abusive behavior,” according to the letter.
“We are sending the letters because we want to ensure that the political committees and the candidates they support understand the rules,” said Commissioner Mark W. Everson. “As Congress considers changes to the law in this area, it is important that political organizations keep in mind the requirements of existing law. Today’s guidance does not represent a change in the rules or a change in how the IRS will administer the law in this area.”
If the IRS finds a Section 501(c)(3) organization engaged in prohibited campaign activity, the organization could lose its tax-exempt status and be subject to an excise tax on the amount of money spent in that activity.
- WebCPA staff
