The Internal Revenue Service (IRS) has warned that links from 501(c)(3) organization websites to other sites may be considered partisan if the facts and circumstances of the link indicate support or opposition for candidates. In addition, Americans United for Separation of Church and State (AU) lodged new complaints about possible partisan intervention in elections, which involve voter guides and the content of a newsletter. Under federal tax law, charities, religious organizations, and all other 501(c)(3) organizations are prohibited from participating or intervening in any political campaign on behalf of, or in opposition to, any candidate for public office. Violations could cost such groups their tax-exempt status. The IRS interprets the ban on a case-by-case basis, using a "facts and circumstances" test. Vagueness about what constitutes prohibited partisan electioneering has resulted in uncertainty for 501(c)(3) organizations wishing to engage in voter activities.

On Jan. 18, Judith Kindell, a senior official in the IRS Exempt Organizations Division, told a meeting of the American Bar Association's Section of Taxation that links on websites sponsored by 501(c)(3) organizations could be considered prohibited intervention in elections, saying 501(c)(3)s are responsible for where their websites lead visitors. However, this does not bar all links to information about candidates: she said the IRS will continue to rely on the facts and circumstances test to determine if certain links are regarded as political intervention.

For example, a factor that could be considered is how closely the organization monitors the links on its site. But Kindell said a 501(c)(3) site that explains an organization's position on an issue and then links to candidates' positions on that issue could be problematic. This raises questions about a 501(c)(3) organization that has a link to a 501(c)(4) organization that in turn has a link directly to a candidate's website. Kindell's comments raise uncertainty about how IRS will view web links, which could have a chilling effect on how 501(c)(3) organizations use links to help educate their users.

Kindell also indicated the IRS will look at 501(c)(3) policies for monitoring bloggers that may endorse a candidate on a charity's site, as well as how speech from outside contributors should be treated. A disclaimer that a 501(c)(3) does not support or oppose candidates would only be one factor in the IRS facts and circumstances analysis, she said.

In Rev. Rul. 2007-41, issued by the IRS in 2007, the agency indicated, "Links to candidate-related materials, by themselves, do not necessarily constitute political campaign intervention…. The facts and circumstances to be considered include, but are not limited to, the context for the link on the organization's website, whether all candidates are represented, any exempt purpose served by offering the link, and the directness of the links…"

Rev. Rul. 2007-41 is the most current available guidance for 501(c)(3)s that want to educate voters and avoid partisan intervention. It leaves many fact situations in gray areas, however, which has created confusion and contributes to an increasing number of complaints to the IRS. In the past few weeks, the Columbus Dispatch quoted the Rev. Harold Hudson, pastor of Calvary Tremont Missionary Baptist Church in Columbus, as saying, "Let's be honest. Everybody's afraid of the Internal Revenue Service." In addition, the article suggests that the candidates are actually competing for endorsements of black pastors. Candidate appearances in churches are common, and the question of when and how personal endorsements from religious leaders are permissible is not clearly answered by IRS guidance. For example, as the Dispatch article notes, "Hillary Clinton picked up an endorsement from the Rev. Calvin O. Butts III outside his Baptist church in New York City. And Obama is eagerly seeking support from black ministers in advance of Saturday's key primary in South Carolina."

AU filed a complaint with the IRS calling for an investigation into two tax-exempt groups that allegedly produced biased voter guides for the 2008 Republican presidential primary. According to AU, a voter guide from the American Family Association of Tupelo, MS, and WallBuilders of Aledo, TX, are intended to support Republican presidential candidate Mike Huckabee. The voter guides in question are actually the same document, with minor differences in how the issues are defined. The guides list the candidates and their positions on issues, such as "traditional marriage" and "moral education." Since only Huckabee has a "yes" on all of the issues, AU argues that the groups are guiding voters to vote for Huckabee. An AU press release quotes Executive Director Barry Lynn as saying, "These guides are not voter education, they're partisan propaganda."

Lynn said the organizations seem to have given the candidates "no opportunity to respond to the issues and instead assigned stances based on the organizations' own 'research' and subjective analysis. Footnotes supposedly documenting the candidates' stances are often irrelevant or old. In several cases, the guides reference sources from 1994 and 1996." According to the IRS, voter guides "may be distributed with the purpose of educating voters; however, they may not be used to attempt to favor or oppose candidates for public elected office."

AU also challenged the legality of a Jan. 21 newsletter article in the Southern Baptist Convention's (SBC) official news outlet, the Baptist Press. President Frank Page was quoted as saying that he agrees with James Dobson of Focus on the Family that a united front against Giuliani is needed and that "evangelicals can realistically defeat him." Even a ticket with Giuliani on top and Huckabee for vice president "would be problematic for Dr. Dobson and myself." AU advised Page in a letter that the use of tax-exempt resources to support or oppose candidates for public office is prohibited. Since there was no indication that Page was speaking as an individual as opposed to an official within the church, it could possibly be construed that the church's resources are being used to oppose Giuliani. Rev. Rul. 2007-41 provides an example in its section on individual activities of organizational leaders (Situation 4) that clearly indicates statements of personal partisan preferences in an organizational newsletter constitute campaign intervention, even if the individual pays for the space.