501(c)4

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501(c)4

A subsection of the Internal Revenue Code governing the status of non-profit organizations devoted to lobbying for political, civic, or other, similar causes. 501(c)4 organizations are exempt from federal taxation. However, contributions and donations made to them are not tax exempt. Examples of 501(c)4 organizations include political campaigns and groups that advocate for certain issues. In order to qualify for 501(c)4 status, all of the organization's earnings must be used for social welfare purposes.
References in periodicals archive ?
Angel Protectors of Animals and Wildlife is a California based, 501c3 and 501c4 non profit animal and wildlife rescue organization (in formation), which raises awareness and changes public policy for both domestic animals and wildlife.
Gary Hirshberg is chairman of yogurt maker Stonyfield Farm and the Just Label It campaign, a 501c4 lobbying organization with over 550 organizations and businesses that have signed on to its effort to require GMO labeling at the federal level.
A year ago, it changed to a 501c4 nonprofit tax-exempt organization, which doesn't have to make such disclosures.
Though 501c4 nonprofit groups must spend, "at least half of their money on non-political activities," they are required to disclose very little about their donors or how they spend their money which means foreign entities have a means to influence state and federal elections.
New tax laws created tax breaks for nonprofits, leading to the creation of thousands of 501c3 (education and research) and 501c4 (political action committee [PAC] and lobbying) organizations.