On October 16, 2000 the IRS published a request for public comment on issues pertaining to use of the Internet by exempt organizations.  In its announcement (2000-84) (http://www.ombwatch.org/article/articleview/403/1/3/), the IRS asked a series of general questions, as well as specific ones about legislative and political activities, and solicitation and advertising. The IRS said it is "considering issuing guidance that would clarify the application of code provisions governing exempt organizations to activities they conduct on the Internet."  They point out that no final decision has been made on either the need for guidance or what position IRS should take if it moves forward.  The IRS is accepting comments until February 13, 2001.   OMB Watch is seeking input from nonprofits across the country on comments we should convey to the IRS.  To begin the discussion we have identified a few principles and specific responses regarding the sections dealing with lobbying and political activities.  Please send your thoughts and suggestions.  We will take them into consideration when we draft our comments. Please send comments to guinanek@ombwatch.org. Proposed Principles to Guide Application of Tax Code to Internet Advocacy by Charities 1.  Clarification on application of the tax code to nonprofit advocacy on the Internet can help clear up confusion and encourage continued development in the ways nonprofits can use Internet technology to accomplish their goals.  It should not restrict this ongoing development by being overly specific or creating a layer of oversight that does not exist for other forms of communications.  Specifically, no new regulations are likely to be needed. Do you agree or disagree with this statement?  Why?   What Internet uses raise the most questions about IRS rules for your group? 2.  The IRS approach to advocacy on the Internet should be consistent with a general public policy of encouraging free and open use of the Internet and of supporting public participation by charities.  In other words, take the least restrictive approach possible. Do you agree?  Can you give us an example of how you are still finding new ways to use the Internet for public education and advocacy? 3.  Simplicity should be an essential feature of any guidance issued by the IRS.  As a result, Internet communications with clear non-Internet analogies (i.e., e-mail and paper letters) should be treated in the same manner as the non-Internet items. Comments and/or examples: 4.  The IRS should differentiate between forms of communications on the Internet (websites, e-mail, discussion groups, instant messaging, chat, webcasting) and different uses of these forms.  For example, a website can include material published by an organization as well as material posted for informational purposes whose content is not endorsed by the host. Is there a difference in the kinds of communications you post on a web page or send by e- mail?   How do you decide what form of Internet communication to use? Specific Issues Raised in IRS Request for Comments 1. Websites as Single or Multiple Publications. The IRS asks whether websites should be treated as a single publication or separated into distinct parts.  Our initial response is that websites should not be treated as publications, but as mediums of communication.  Documents posted on a website are separate publications, and only their content should be subject to IRS regulation, just as they would subject to regulation as if they were in print format.  The structure and layout of a website (including information to help navigate the site) should not be treated as content.   How do you use your website for advocacy and legislative lobbying? Do you only post your own documents or do you provide space for others to post information as well? 2. Hyperlinks. The IRS raises issues related to links and the lobbying and voter education work of charities.  They ask whether or not the content on a linked site should be attributed to the organization posting the link.  Our initial response is that links should not be treated as communications, but as part of the structure of the web, unless there is an express statement of endorsement for content on the linked site.   (Hyperlinks are analogous to providing telephone numbers.  Individuals still must take action to obtain the information through the link.)  Links to sites of candidates or political parties should not be interpreted as support for that candidate or party if links to opposing candidates and parties are included and similarly presented. What kinds of links do you use?  Do you have links to elected officials, candidates or government agencies?  What is the purpose of those links? 3. Mass Media. The Request for Comments raises questions as to whether the Internet is the equivalent to mass media and the lobbying communications should be treated under such rules.  This would mean that lobbying communications would be counted as grassroots lobbying expenditures.  We think the issue is not whether the Internet is mass media but rather whether the charity pays an Internet distribution mechanism for ads that convey a lobbying communications.  The current mass media rules would then prevail. Do you purchase ad space on the Internet?  Do you post your newsletter on the Internet?  Does it contain paid ads? 4. Voter Education Websites. How can nonprofits provide voters with information on candidates and remain nonpartisan?  The IRS indicated approval of a Federal Election Commission decision earlier this year that a voter education website developed by the League of Women Voters was nonpartisan. How can charities use the Internet for nonpartisan voter education? 5. Archives. The IRS asked what standards should be used for nonprofits to archive their website content when it changes.  (The information would provide a record for determining lobbying expenses and show past statements about candidates.)  We don't think there should be any specific requirements on how exempt organizations archive their Internet communications, since there are no parallel rules for archiving fax, phone or paper communications.   Do you agree with this position?  If not, what would be reasonable methods of archiving consistent with an organization's size, character and resources? 6. Cost Allocation. For charities that use the expenditure test to measure their legislative lobbying, the IRS is interested in how those costs are determined when the Internet is used.  We think the marginal cost of posting documents on a website or e-mail transmission should be considered a reasonable cost that counts toward an organization's lobbying expenditure limit.  The costs of maintaining Internet access (e.g., ISP fees, server costs) should be treated the same as other overhead costs with lobbying costs allocated. How does your organization deal with this issue?  What suggestions do you have? 7. Calls to action. The IRS asks what constitutes a call to action for lobbying on the Internet.  We believe only links to legislators that are included in the body of an Internet communication (e-mail message or webpage) that refers to and reflects a view on specific legislation should constitute a call to action. Links that are part of a website structure or otherwise appear outside the context of a document should not convert the document into a grassroots lobbying communication.  For instance, a "Write your Senator" button may be included as a service as a part of the website template on every page, and not appear in connection with information about legislation. How do you use the Internet to encourage people to contact legislators?  Do you provide links as a service, or only in specific situations?  Do you agree with our position? 8. Listservs and Discussion Groups. The IRS asks how it should treat statements made in listservs and discussion groups.  We suggest that they should distinguish between different types of moderated groups.  When an exempt organization acts as a gatekeeper for sharing of information (e.g., an unmoderated listserv or one moderated without regard to content), the content of the discussion should not be attributed to it.   If your group uses listservs or sponsors a discussion group, how do you moderate the content?   9. Communications to Members. Communications made to members, or primarily to members, can be treated differently by 501(c)(3) organizations under the lobbying expenditure rules, or in releasing legislative scorecards.  Do you have on-line members?  Do you use the Internet to send members only communications?  If so, how?