Nonprofit Speech Rights | Center for Effective Government

List of Known PACI Complaints

The Internal Revenue Service (IRS) Political Activities Compliance Initiative (PACI) enforces the ban on partisan activity by charities and religious organizations. On June 8, 2007 the IRS released a report on the initial results of its 2006 program." The results of the enforcement program to date show a continued low level of violations, with the number of 2006 investigations remaining about the same compared to 2004.

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Investigation of United Church of Christ Shows IRS Rules Need Fixing

On Feb. 20, the Internal Revenue Service (IRS) sent the United Church of Christ (UCC) national office a letter announcing the agency has launched an investigation because there is "reasonable belief" that the church violated the ban on partisan electioneering, based on a June 23, 2007, speech by Sen. Barack Obama (D-IL) at the church's 50th General Synod. The investigation has generated strong reactions, and as details emerge, it is clear that this case highlights the inherent weakness of the IRS's facts and circumstances test as a regulatory standard defining what is and is not partisan electioneering.

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SpeechNow Challenges FEC Contribution Limits for Independent Political Groups

SpeechNow.org, an independent organization whose stated mission is to advocate for the election of federal candidates who favor free political speech, has filed a lawsuit challenging federal campaign finance laws that prohibit contributions of more than $5,000 per year to political committees as an unconstitutional violation of free speech and association rights.

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Senate Bill Would Regulate Robocalls during Election Campaigns

On Feb. 12, Senate Rules Committee Chair Dianne Feinstein (D-CA) and Sen. Arlen Specter (R-PA) introduced S. 2624, the Robocall Privacy Act of 2008. The bill would place restrictions on how and when prerecorded messages, known as robocalls, can be made 30 days before a primary and 60 days before a general election. The bill would only affect prerecorded calls, not calls made by volunteers at phone banks.

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Inconsistent Enforcement: IRS Findings in NAACP and All Saints Church Cases

A comparison of two high profile IRS investigations into allegations of election intervention - the All Saints Church and NAACP cases -highlights the vagueness of the regulation and the inconsistency of IRS enforcement. According to OMB Watch's analysis, the facts and circumstances of the All Saints Church and NAACP cases are very similar, but the IRS findings were very different.

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More Blurry Lines: IRS Warns on Web Links, Primaries Continue to Generate Complaints to Agency

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.

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Primary Season Generates Complaints about Church Engagement in Partisan Activities

The 2008 presidential campaign is in full swing, and so is the debate over what charities and religious organizations can say or do without violating the tax code's ban on partisan electoral activity. The Internal Revenue Service (IRS), which enforces the law through its Political Activities Compliance Initiative (PACI) program, has already received numerous requests for investigations, and one church has challenged it to investigate a 2006 sermon. The controversy reflects a healthy interest in public affairs within the nonprofit sector, as well as an unhealthy uncertainty about what is allowed in many election-related activities.

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Supreme Court Asked to Hear Challenge to New FEC Rule on Issue Ads

In December 2007, Citizens United, a 501(c)(4) organization, filed a lawsuit against the Federal Election Commission (FEC) in the U.S. District Court for the District of Columbia claiming that television ads for its film, Hillary: The Movie, should not be subject to donor disclosure requirements under FEC rules. On Jan. 15, a three-judge panel ruled against the group. The organization has since asked the U.S. Supreme Court to consider its case. The suit is a response to the FEC's new rule implementing the Supreme Court's Wisconsin Right to Life (WRTL) decision that allows genuine issue broadcasts to air in the period before federal elections.

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IRS Issues Final Version of New Form 990

On Dec. 20, 2007, the Internal Revenue Service (IRS) released the final version of its updated Form 990, the informational return for public charities and other tax-exempt organizations. The new form marked the first revision since 1979 and will be used for the 2008 tax year (returns filed in 2009). The IRS expects to release draft instructions for the 2008 Form 990 later in January. Although the new Form 990 incorporated many suggestions made in public comments on the draft version, the IRS did not make key changes to clarify and simplify reporting of advocacy-related activities.

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FEC Approves Rule Exempting Issue Advocacy from Broadcast Ban

The Federal Election Commission (FEC) approved a final rule exempting some issue-related broadcasts from the electioneering communications rule. The old rule banned corporations — including nonprofits — and unions from paying for such ads within 60 days of a federal general election or 30 days of a primary, if the ads referred to a federal candidate. The new rule is the FEC's response to the U.S. Supreme Court's decision in the FEC v. Wisconsin Right to Life case, which struck down the ban as applied to grassroots lobbying. The new rule does not provide a specific standard.

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