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Archive for the 'Work' Category
Well, one minute I am complaining about this quarter going by too fast and the next I am thinking about this summer. That has been the craziness of this year for me. I was never exactly sure what my post-graduating plans would be, but now its time to decide more thoroughly.
This decision most immediately manifests itself it in choosing classes for next quarter. Since my propensity to attend Law School is ever increasing, I have decided to take classes that focus on writing. I do not consider myself a poor writer, but I think investing some time would be a great resource. On that note, I am taking an English course that focuses on writing about ethical issues. I thought this would be interesting and most applicable to the type of writing I do. I am also going to take a History of Philosophy course. Fall Quarter I took the first course in this series and really enjoyed. It is fascinating how influential thinkers’ ideas pop up throughout history. Of course, I am taking Chinese, which I have grown to dislike. Thankfully, this will be the last Chinese course I have to take. Chinese is not a friend of my GPA, I just keep thinking: why didn’t I take Spanish? The last course I will have will be Economics of the Environment and Natural Resources. I am pretty excited for this class because I like the teacher and the subject-matter. It will cover air pollution, fishing, and global warming. Considering the craziness of the debate topic junior year of high school, I should have some knowledge to bring to the table.
To complicate matters further, Monica and I want to move soon. Hopefully, we can pull that off without a hitch.
Two Fridays ago, I participated in a program where we went to several law firms, a non-profit, and the district court. I firmly believe that this aided my desire to attend law school. It drives me nuts though thinking about preparing for a decent LSAT. I am becoming more confident that I can do it though. I have been mulling over taking a test prep class just to be certain I do well. I feel like I can hit my peak success at standardized tests.
In the meantime, I have to continue the ridiculous amount of reading that I have for the History of Economic Thought. Also, I have a paper that I want to write on police discretion, so hopefully that will be done soon. There are also about a million things I need to do for CPP!
I want to use my blog as a sort of note-taking grounds for information on creating a non-profit, specifically in Illinois. Maybe this will help someone else out as well, but do not expect any form of coherent organization…yet. This information is from the IRS website and the Illinois State Dept. website.
Let us begin with a broad overview of what it the tax exemption requirements are:
To be tax-exempt under section 501(c)(3) of the Internal Revenue Code, an organization must be organized and operated exclusively for exempt purposes set forth in section 501(c)(3), and none of its earnings may inure to any private shareholder or individual. In addition, it may not be an action organization, i.e., it may not attempt to influence legislation as a substantial part of its activities and it may not participate in any campaign activity for or against political candidates.
Organizations described in section 501(c)(3) are commonly referred to as charitable organizations. Organizations described in section 501(c)(3), other than testing for public safety organizations, are eligible to receive tax-deductible contributions in accordance with Code section 170.
The organization must not be organized or operated for the benefit of private interests, and no part of a section 501(c)(3) organization’s net earnings may inure to the benefit of any private shareholder or individual. If the organization engages in an excess benefit transaction with a person having substantial influence over the organization, an excise tax may be imposed on the person and any organization managers agreeing to the transaction.
Section 501(c)(3) organizations are restricted in how much political and legislative (lobbying) activities they may conduct. For a detailed discussion, see Political and Lobbying Activities. For more information about lobbying activities by charities, see the article Lobbying Issues; for more information about political activities of charities, see the FY-2002 CPE topic Election Year Issues.
Next, I think it is appropriate to look at what exactly the exemption requirements are:
The exempt purposes set forth in section 501(c)(3) are charitable, religious, educational, scientific, literary, testing for public safety, fostering national or international amateur sports competition, and preventing cruelty to children or animals. The term charitable is used in its generally accepted legal sense and includes relief of the poor, the distressed, or the underprivileged; advancement of religion; advancement of education or science; erecting or maintaining public buildings, monuments, or works; lessening the burdens of government; lessening neighborhood tensions; eliminating prejudice and discrimination; defending human and civil rights secured by law; and combating community deterioration and juvenile delinquency.
Next, I think we should take a look at what exactly a 501(c)(3) can do. First, in regard to political campaigning:
Under the Internal Revenue Code, all section 501(c)(3) organizations are absolutely prohibited from directly or indirectly participating in, or intervening in, any political campaign on behalf of (or in opposition to) any candidate for elective public office. Contributions to political campaign funds or public statements of position (verbal or written) made on behalf of the organization in favor of or in opposition to any candidate for public office clearly violate the prohibition against political campaign activity. Violation of this prohibition may result in denial or revocation of tax-exempt status and the imposition of certain excise tax.
Certain activities or expenditures may not be prohibited depending on the facts and circumstances. For example, certain voter education activities (including the presenting public forums and publishing voter education guides) conducted in a non-partisan manner do not constitute prohibited political campaign activity.
In addition, other activities intended to encourage people to participate in the electoral process, such as voter registration and get-out-the-vote drives, would not constitute prohibited political campaign activity if conducted in a non-partisan manner. On the other hand, voter education or registration activities with evidence of bias that: (a) would favor one candidate over another; (b) oppose a candidate in some manner; or (c) have the effect of favoring a candidate or group of candidates, will constitute prohibited participation or intervention.
I think this last rule could use a bit of summarizing. Basically, no campaigning or fund raising can be done on behalf of a candidate. Non-partisan, educational activities can be conducted though. Examples of this are voters guides, voter registration, public forums, and ‘get out the vote’ drives. These rules are complicated because of the test of bias includes having the effect of favoring a candidate. Obviously, if a group takes a stance on an issue and informs the public a candidate holds the opposite view, there is some gray area in deciding if that is in opposition to candidate.
The next logical step: Lobbying.
In general, no organization may qualify for section 501(c)(3) status if a substantial part of its activities is attempting to influence legislation (commonly known as lobbying). A 501(c)(3) organization may engage in some lobbying, but too much lobbying activity risks loss of tax-exempt status.
Legislation includes action by Congress, any state legislature, any local council, or similar governing body, with respect to acts, bills, resolutions, or similar items (such as legislative confirmation of appointive office), or by the public in referendum, ballot initiative, constitutional amendment, or similar procedure. It does not include actions by executive, judicial, or administrative bodies.
An organization will be regarded as attempting to influence legislation if it contacts, or urges the public to contact, members or employees of a legislative body for the purpose of proposing, supporting, or opposing legislation, or if the organization advocates the adoption or rejection of legislation.
Organizations may, however, involve themselves in issues of public policy without the activity being considered as lobbying. For example, organizations may conduct educational meetings, prepare and distribute educational materials, or otherwise consider public policy issues in an educational manner without jeopardizing their tax-exempt status.
Of course, the government leaves us with another vague rule. The same spirit applies to this rule as to campaigning – if activities are conducted in the non-partisan spirit of education, they are acceptable. The brightline for lobbying activities is again vague, but there is not an absolute prohibition on lobbying.
The IRS provides a list of empirical examples of tax law applied and the general principal that is the result of the ruling. I think this will prove to be a helpful document when attempting to live within the sometimes vague rules. Especially considering the findings from the 2004 election cycle:
Internal Revenue Service officials have released a report, with executive summary, on the agency’s examination of political activity by tax-exempt organizations during the 2004 election campaign. The report found some level of prohibited political activity by section 501(c)(3) organizations in nearly three-quarters (emphasis added) of the cases reviewed.
In connection with the report, the IRS is also unveiling new procedures for the 2006 election season, which provide additional guidance to charities regarding political activities. As part of its approach to combating this activity, the IRS has begun its educational and enforcement efforts to help ensure that charities have enough advance notice of the statutory rules against engaging in political activities.
Interestingly enough, their is a definitive Supreme Court ruling that gives guidance on this issue:
A definitive court case on the issue of free speech and political expression is Branch Ministries Inc. versus Rossotti. In that case, the court upheld the constitutionality of the ban on political activity. The court rejected the plaintiff church’s allegations that it was being selectively prosecuted because of its conservative views and that its First Amendment right to free speech was being infringed.
The court wrote: “The government has a compelling interest in maintaining the integrity of the tax system and in not subsidizing partisan political activity, and Section 501(c)(3) is the least restrictive means of accomplishing that purpose.”
In 1954, Congress approved an amendment by Sen. Lyndon Johnson to prohibit 501(c)(3) organizations, which includes charities and churches, from engaging in any political campaign activity. To the extent Congress has revisited the ban over the years, it has in fact strengthened the ban. The most recent change came in 1987 when Congress amended the language to clarify that the prohibition also applies to statements opposing candidates.
What about judicial appointments?
501(c)(3) charitable, etc., organizations. Limited lobbying to influence Senate confirmation of judicial appointments is permitted.
Attempts to influence Senate confirmation of a federal judicial appointment are not considered campaign intervention, which is specifically forbidden by section 501(c)(3). However, because attempts to influence Senate confirmation are considered lobbying, they are subject to the rules on lobbying
Next post will cover some of the relevant documents that need to be completed in order to achieve tax exempt status.
Wow, I make an intense claim that I need to start podcasting and then I stop making blog posts. I guess I have proven I really have what it takes to accomplish that!
Well, a lot has been happening recently. Over winter break I went on vacation – once with my family and once with Monica. Both were a lot of fun. School has started again I have some interesting classes this semester at NU. History of Economic Thought, Politics of Local Justice, and my second to last quarter of Chinese. I also am taking a Legal Studies class as credit for participating in Mock Trial.
As one could tell from my facebook quotes, I am really enjoying the history of economic thought. It is fantastic reading the writings of the great minds that have formed my field of study.
I have been fervently looking for jobs, mostly in the financial industry. It is nice being at a school where the business school does not hide all the opportunities away. I have started working for a more public interest like group called the Cyber Privacy Project. It is run by a professor from the Harvard Medical School who is a visiting prof at the Medill School of Journalism at NU. It is interesting and if I can muster up some time to devote to it I think I could play an exciting role
In other news, I really need to start pumping out some LSAT prep and figure out what I am going to do next year!
I recommend anyway with a slight interest in MN politics head over to Minnesota Public Radio and create a Fantasy Legislature. Feel free to join the Red League.
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