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ExpressTaxExempt Blog

Thursday, July 16, 2015

Lobby Party




“You gotta fight / for your right / to Lobbbbby!”

Well, not so much in this case. While your tax-exempt organization can participate in lobbying activities, but too much lobbying can lead to the risk of losing your tax-exempt status. Generally, no organization can qualify for tax-exempt status if a substantial part of its activity is pursuing to influence legislation aka lobbying.

Legislation
As defined by the IRS, legislation includes action by Congress, any state legislature, any local council, or similar governing body, in regard to acts, bills, resolutions, or similar items like legislative confirmation of appointive office, or by the public in referendum, ballot initiative, constitutional amendment, or similar procedure; however, it does not include actions by executive, judicial, or administrative bodies.

Your organization can be seen as attempting to influence legislation if you contact, or urge people to contact, members or employees of a legislative body for the purpose of proposing, supporting, or opposing legislation, or if your organization advocates the adoption or rejection of legislation.

Principal Registration and Reporting
If you wish for your organization to lobby, you must register your organization as a “Principal” before engaging in any lobbying activities. As Principal, your organization must provide a name its “Designated Lobbyist” and any other lobbying on behalf of your organization.

The Secretary of State has to be notified if any change of information occurs within five business days of the change, and your organization must notify any person it lists as a lobbyist and have them register with the Secretary of State and provide reports. In addition, as a Principal, your organization will also provide annual reports renew its registration every two years - up until you want your organization to no longer lobby.

Types of Lobbyists


Designated Lobbyist Registration and Reporting
Each principal has to have a “Designated Lobbyist.” Their responsibility is to file the Lobbyist Registration and Lobbyist Quarterly Expenditure Reports along with the registration and Annual Expenditure Reports for the Principal.

An individual or a professional lobbying firm can act as a Designated Lobbyist. Whoever is appointed the title, they sign all reports for themselves as well as the represented Principal.

Lobbyist for Compensation
This is either an individual or firm compensated by the Principal and whose sole job responsibility is to lobby for the Principal. It’s also required by this lobbyist to file a Lobbyist Registration form and to file Lobbyist Quarterly Expenditure Reports with the Secretary of State.

Authorized Lobbyist
Any other lobbyist you have, other than the Designated Lobbyist or Lobbyist for Compensation, is considered as an Authorized Lobbyist. This lobbyist could be a paid staff member or a volunteer for the Principal and is seen as registered when listed on the Principal’s registration. This person reports expenditures only to the Designated Lobbyist.

Employees of Lobbyists
These people are lobbyists that are employed by either firms or other lobbyists and they are registered by whomever employed them. They do not file expenditure reports directly to the Secretary of State, but their reports are included in their employer’s Lobbyist Quarterly Expenditure Report.

Outside from general lobbying, tax-exempt organizations can participate in issues of public policy without it being considered as lobbying. For example, your organization can plan educational meetings, prepare and hand out educational materials, or simply just consider public policy issues in an educational manner.

As with any lobbying activity, large or small, it must be reported within your Form 990 or Form 990-EZ under Schedule C. Keep the party going by e-filing your Schedule C, along with the rest of your 990 form, with Express990. We offer a safe, secure, and accurate e-filing process, backed by expert professionals that will save you time and money.

For assistance with e-filing any of our available 990 forms, contact our live support by phone Monday through Friday from 9am to 6pm, Eastern Standard Time, at (704) 839-2321, by email at support@expresstaxexempt.com, or by live chat at the Express990 website


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