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National Council of Nonprofits


It’s “Go Time” for Protecting Nonprofit Nonpartisanship

On May 4, the attacks on the Johnson Amendment by way of a congressional hearing and a presidential executive order were coordinated, ruthless, and effective. How effective is yet to be determined. But no reasonable person can think that the zeal by some to politicize and polarize the 501(c)(3) charitable, religious, and philanthropic community by repealing or weakening the current legal protections against rancorous partisan electioneering is going to fade away or that it is a non-issue. The direct threat to the 501(c)(3) community is real and urgent. It’s rally time for all front-line charitable nonprofits, religious entities, and foundations to engage and be vocal to protect your organizations and the vital missions you serve.


While the Executive Order received significantly more news coverage, the congressional hearing and the legislation it sought to promote present the greater challenge to the charitable and foundation communities and will be addressed first. Before that, however, everyone in the sector needs to understand the Johnson Amendment so we all are equipped to correct those who are not speaking the truth as they try to disrupt and politicize our sector for their own advantage.


"What is the Johnson Amendment?

Section 501(c)(3) of the Internal Revenue Code allows certain groups to be exempt from federal income taxes and eligible to receive tax-deductible contributions in exchange for complying with three separate conditions. The first condition is the most famous: that 501(c)(3) nonprofits cannot pay out profits to benefit shareholders or individuals. The third condition states that 501(c)(3) entities may “not participate in, or intervene in (including the publishing or distributing of statements), any political campaign on behalf of (or in opposition to) any candidate for public office.” That condition, nicknamed “the Johnson Amendment,” was proposed by then-Senate Minority Leader Johnson to legislation passed by a Republican-controlled Congress and signed by President Eisenhower in 1954. In practical terms, the language protects charitable nonprofits, including religious institutions, and foundations from partisan electioneering, such as political endorsements and campaign contributions. Other speech, such as commentary on legislation, social and moral issues, is in no way touched or restricted by the Johnson Amendment.


Legislative Challenge

House Hearing Promotes Weakening/Repealing the Johnson Amendment

A congressional hearing, ostensibly to investigate the free speech rights of churches, turned out to be a full-frontal attack on the Johnson Amendment. Witnesses called by the majority party alleged that current enforcement by the Internal Revenue Services is both overly aggressive and non-existent, without apparent awareness of the inconsistency of their positions. They also claimed that the lack of clarity in the law and enforcement create a chilling effect on the free speech of preachers and others who cannot reasonably discern what speech would and would not violate the law.


Rabbi David Saperstein, the witness called by the minority party, offered rebuttal testimony demonstrating that most people correctly understand that the Johnson Amendment only prevents express endorsement or opposition to candidates, and that virtually all discussions by religious and nonprofit speakers on moral, public policy, and advocacy matters are proper under the law and Constitution. By all accounts, the House hearing was conducted to showcase legislation to weaken the Johnson Amendment, the euphemistically named Free Speech Fairness Act (H.R.781) discussed below. Learn more about the hearing by watching the recording, and reading the additional written testimony submitted by the National Council of Nonprofits and the Baptist Joint Committee on Religious Liberty.


Scalise/Lankford Bill Would Blow a Large Loophole in Nonpartisanship

Legislation promoted in the House hearing would substantially weaken the law mandating nonpartisanship by allowing leaders of individual 501(c)(3) entities to openly endorse candidates for public office and engage in some partisan electioneering activities. Specifically, the bills sponsored by Representative Scalise (R-LA) and Senator Lankford (R-OK) (H.R. 781 and S.264, respectively) would legitimize partisan political statements, such as endorsements, that were “made in the ordinary course of the organization’s regular and customary activities in carrying out its exempt purpose,” as in speaking from the pulpit or sending out emails to members and the public. The legislation, unlike the Executive Order, would apply to ALL 501(c)(3) organizations, not just “religious” groups. The only restriction would be that the statements could not result in “the organization incurring not more than de minimis incremental expenses.”


What’s Wrong with That? Plenty, from the perspective of nonprofit, religious, and foundation leaders from across the country. First, the law protecting nonprofits from partisan demands is considered essential and immutable. Last month, 99 religious and denominational organizations delivered a letter to Congress expressing strong opposition to “any effort to weaken or eliminate protections that prohibit 501(c)(3) organizations, including houses of worship, from endorsing or opposing political candidates.” Second, determining what constitutes an organization’s “regular and customary activities” demands as much subjective scrutiny as the IRS’s current “facts and circumstances” test that obfuscates rather than clarifies any legal analysis.


Third, the “de minimis” test offered in the legislation has no meaning in current law, creating speculation, regulations, and litigation. For example, the law on 501(c)(4) organizations requires that funds be “devoted exclusively to charitable, educational, or recreational purposes,” yet the IRS has interpreted “exclusively” to mean no more than 50 percent, making nearly half of a social welfare organization’s assets available for the types of partisan, election-related activities that proponents of the Scalise/Lankford bills are seeking. Further, including a “de minimis” test in the law would invite greater scrutiny by the IRS and others into the financial affairs of churches than current law. That is because most religious institutions are exempted from filing the IRS Form 990, which requires all other 501(c)(3) organizations to disclose how much they receive and how they spend those dollars. Finally, the odd combination of “de minimis” and “incremental” suggest that the amount of expenses could increase over time. Given that de minimis for the Gates Foundation and a local food bank will vary widely, as will the amounts by a mega-church with its televised messages versus those of that same local food bank, the legislation awards an unfair greater partisan voice to larger entities.


If enacted, the legislation would politicize charitable nonprofits, houses of worship, and foundations, plunging them into the caustic partisanship that bedevils our country solely for the benefit of politicians and political operatives. The consequences, including the following examples, could be irreparable:

  • Donors turn away from some or all charitable nonprofits as the raw partisan actions of a few undermine the appreciation of the sector as the one place safe from political discord.
  • Nonprofit effectiveness is lost as board members with contrary views divert attention away from mission by arguing that the organization should endorse opposing candidates, whether business clients, family members, or college friends, creating ill-will and polarizing the board on other unrelated issues.
  • Nonprofit missions are eroded when board members and/or wealthy donors demand that the organization take sides in local, state, or federal elections.
  • Local college presidents, hospital executives, or preachers send out emails endorsing political candidates to alumni, former patients, or parishioners, thereby distributing a no-cost message (presumably satisfying the de minimis language in the legislation) but inducing candidates, their operatives, and their donors to exert immense pressure (whether lawful and moral, or not) on other nonprofits to follow suit or face repercussions.

What You Can Do:

  • Sign the Community Letter in Support of Nonpartisanship! Join more than 4,500 organizations – charitable nonprofits, religious institutions, foundations, and others from across the country to show that we intend to resist any and all efforts to politicize our sector by weakening or repealing this longstanding protection in federal tax law that keeps 501(c)(3) organizations away from endorsing, opposing, or contributing to political candidates. Once more signatures are collected, this letter will again be delivered to every congressional office, but this time with a stronger showing of support from you and many others.
  • Spread the Word: Forward this message to three or more colleagues and encourage them to also sign their organizations onto the Community Letter. Click here for an easy way to do it.
  • Make the Calls: Call your Representative and two Senators and tell them to preserve current law that protects charitable nonprofits, including houses of worship, and foundations, as well as the millions of people we serve every day. Letters are good, personal meetings are great, but a phone call from you now is quick, easy, and effective.
  • Write Letters to the Editor: Correct the record of inaccurate news stories or cheer editors on for taking strong positions in support of nonprofit nonpartisanship by submitting letters to the editor of your local newspapers. It’s also helpful to share why politicizing charitable nonprofits and foundations is a bad idea.

Executive Order Challenge

Confusion Abounds from Trump Executive Order on Religious Partisanship

In a Rose Garden ceremony, President Trump signed an Executive Order entitled, “Promoting Free Speech and Religious Liberty.” He made several claims at the ceremony, including, “We are giving our churches their voices back,” based on the unsubstantiated premise that the Johnson Amendment restricts religious speech. Numerous publications reported that the President has loosened the legal restrictions on endorsing or opposing candidates, or that he has instructed the IRS to stop enforcing the law against churches and other religious institutions. Others noted, however, that the text of the Executive Order lacks clarity and does a great disservice to law-abiding charitable nonprofits and religious institutions.


Section 2 of the Executive Order directs the Department of Treasury (and hence the IRS) to “not take adverse action against” individuals or organizations on account of their speech on “moral or political issues from a religious perspective” where similar speech has “not ordinarily been treated as participation or intervention in a political campaign on behalf of (or in opposition to) a candidate for public office by the Department of the Treasury.” By its language, the Order appears to warn the government against changing its interpretation of what is “participation or intervention in a political campaign” as applied to religious speech. After reading this language, the ACLU issued a revised statement calling the signing of the Executive Order “an elaborate photo-op with no discernible policy outcome.” One pro-repeal commentator complained that the Executive Order merely restates current law. Another writer speculates that the Executive Order merely “gives IRS officials explicit permission to do what they already do: rarely enforce the Johnson Amendment.”


The responses of the charitable nonprofit and foundation communities were united in their opposition to the Executive Order. “We are a country of laws, not a country that tolerates a wink and a nod from a partisan official telling the IRS to effectively ignore laws properly passed by Congress decades ago,” stated Tim Delaney on behalf of the National Council of Nonprofits. He continued, “The U.S. Constitution does not empower a President to line-item veto a few lines from longstanding law (in this case, the so-called “Johnson Amendment” that protects 501(c)(3) nonpartisanship) that his political allies find inconvenient.” Dan Cardinali of Independent Sector expressed concern that the Executive Order “puts us on a fundamentally wrong path by effectively easing Johnson Amendment prohibitions against political activity for 501(c)(3) nonprofit organizations.” The Order “takes our country in the wrong direction by injecting politics and partisanship into the charitable sector,” agreed David Biemesderfer of the Forum of Regional Associations of Grantmakers. Amanda Tyler of the Baptist Joint Committee for Religious Liberty stated more forcefully that the Executive Order "is further evidence that President Trump wants churches to be vehicles for political campaigns."


The National Council of Nonprofits and others remain concerned that there is room for mischief in Section 2 of the Executive Order and that special interests seeking to repeal or weaken the Johnson Amendment will develop creative legal theories, based on the Executive Order, to flout the law that charitable nonprofits and foundations must still honor.


What You Can Do: All people dedicated to maintaining nonprofit nonpartisanship can help the broad nonprofit and foundation communities by monitoring the effects of the Executive Order in your communities. Let us know if you:

  • See news reports or other evidence (such as church bulletins) of religious groups directly engaging in politicking by expressly endorsing or opposing candidates, spending on candidates, or promoting donations to them, etc.
  • Feel frustration or experience a lack of influence because your organization cannot speak out for/against candidates running for public office in the thousands of elections this year while religious groups can under the Executive Order.