Order Code 96-809 A
Lobbying Regulations on
Updated May 7, 2008
Jack H. Maskell
American Law Division
Lobbying Regulations on Non-Profit Organizations
Public charities, religious groups, social welfare organizations and other nonprofit organizations which are exempt from federal income taxation are not generally
prohibited from engaging in all lobbying or public policy advocacy activities merely
because of their tax-exempt status. There may, however, be some lobbying
limitations on certain organizations, depending on their tax-exempt status and/or their
participation as federal grantees in federal programs. Additionally, organizations
(other than churches or their affiliates) which meet specified threshold expenditure
requirements on lobbying activities and which engage in direct lobbying of federal
officials must register employees who are paid to lobby, and must file reports on
lobbying activities, under the Lobbying Disclosure Act of 1995, as amended.
As to the different categories of tax-exemption: charitable, religious or
educational organizations which are exempt from federal income taxation under
Section 501(c)(3) of the Internal Revenue Code, who may receive contributions from
private parties that are tax-deductible for the contributor, may not engage in direct
or grass roots lobbying activities which constitute a “substantial part” of their
activities if they wish to preserve this preferred tax-exempt status. “Civic leagues or
organizations not operated for profit but operated exclusively for the promotion of
social welfare ....,” tax exempt under 26 U.S.C. § 501(c)(4), on the other hand, have
no tax consequence expressed in the statute for lobbying or advocacy activities. (But
note restrictions on 501(c)(4)’s receiving federal grants or loans). Labor and
agricultural organizations, tax-exempt under Section 501(c)(5) of the Internal
Revenue Code, and business trade associations and chambers of commerce, exempt
from federal income taxation under Section 501(c)(6), also have no specific statutory
limitations upon their lobbying activities as a result of their tax-exempt status.
Private foundations are generally not allowed to lobby.
A provision of the 1995 Lobbying Disclosure Act, commonly called the
“Simpson Amendment,” prohibits section 501(c)(4) civic leagues and social welfare
organizations from engaging in any “lobbying activities,” even with their own private
funds, if the organization receives any federal grant, loan, or award. Because of the
definitions under the Lobbying Disclosure Act, however, the “Simpson Amendment”
limitations do not appear to apply to any “grass roots” lobbying or advocacy, nor to
lobbying of state or local officials, and the amendment also exempts certain other
official communications or testimony.
Finally, federal contract or grant money may not be used for any lobbying,
unless authorized by Congress. No organization, regardless of tax status, may be
reimbursed out of federal contract or grant money for any lobbying activities, or for
other advocacy or political activities, unless authorized by Congress. This applies
to direct or “grass roots” lobbying campaigns at the state, local or federal level (but
exempts providing technical and/or factual information related to the performance
of a grant or contract when in response to a documented request). The provision of
law at 18 U.S.C. § 1913, as amended, as well as the so-called “Byrd Amendment,”
would also generally prohibit the reimbursement or payment from federal grants or
contracts of the costs for “lobby” activities.
Tax Code Status and Lobbying . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 501(c)(3) Charitable Organizations . . . . . . . . . . . . . . . . . . . . . . . . . 1
Section 501(c)(4) Civic Organizations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Section 501(c)(5) Labor Organizations
and 501(c)(6) Trade Associations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Veterans’ Organizations - Section 501(c)(19) . . . . . . . . . . . . . . . . . . . . . . . 4
Private Foundations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Receipt of Federal Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
501(c)(4) Organizations Receiving Federal Grants . . . . . . . . . . . . . . . . . . . . 5
Restrictions on Use of Federal Funds Generally . . . . . . . . . . . . . . . . . . . . . 7
Required Disclosures of Lobbying Activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Lobbying Disclosure Act of 1995, as Amended . . . . . . . . . . . . . . . . . . . . . . 9
Tax Code Disclosures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Additional Reading . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
CRS Reports . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Lobbying Regulations on
This report is intended to provide a brief overview of the various potential
restrictions or regulations within federal law on the lobbying activities of non-profit
organizations. Public charities, social welfare organizations, religious groups, and
other non-profit, tax-exempt organizations are not generally prohibited from
engaging in all lobbying or public policy advocacy merely because of their federal
tax-exempt status. There may, however, be some limitations and restrictions on
lobbying by certain non-profit organizations, as well as general public disclosure and
reporting requirements relative to lobbying activities of most organizations.
There are, in fact, several overlapping laws, rules and regulations which may
apply to various non-profits which engage in lobbying activities. In some instances,
the rules and restrictions that apply may be determined by the section of the Internal
Revenue Code under which an organization holds its tax-exempt status. In other
instances, certain rules and regulations may apply depending on the type of non-profit
organization and whether it receives federal grants, loans or awards. Finally,
organizations, depending on the amount and type of lobbying in which they engage,
may be required to file public registration and disclosure reports under the federal
Lobbying Disclosure Act of 1995, as amended. It should be emphasized that the
definitions of the terms “lobbying” or “advocacy,” and which particular activities
may be encompassed in or excluded from those terms, may vary among the different
regulations, rules, and statutes.
Tax Code Status and Lobbying
Section 501(c)(3) Charitable Organizations
Organizations which are exempt from federal income taxation under section
501(c)(3) of the Internal Revenue Code (26 U.S.C. § 501(c)(3)) are community
chests, funds, corporations or foundations “organized and operated exclusively for
religious, charitable, scientific, testing for public safety, literary, or educational
purposes.” These charitable organizations, which have the advantage of receiving
contributions from private parties which are tax-deductible for the contributor under
26 U.S.C. § 170(a), are limited in the amount of lobbying in which they may engage
if they wish to preserve this preferred federal tax-exempt status.1
26 U.S.C. §§ 501(c)(3), 501(h), 4911, 6033; see IRS Regulations at 55 F.R. 35579-35620
(August 31, 1990), 26 C.F.R. Parts 1, 7, 20, 25, 53, 56, and 602.
The general rule for a charitable organization exempt from federal taxation
under § 501(c)(3) is that such organization may not engage in lobbying activities
which constitute a “substantial part” of its activities.2 In 1976, a so-called “safe
harbor” was offered to 501(c)(3) organizations where they could elect to come within
specific percentage limitations on expenditures to assure that no violations of the
“substantial part” rule would occur, or they could remain under the old, unspecified
“substantial part test.”3 The specific statutory limitations upon organizational
expenditures for covered lobbying activities (the “expenditure test” limitations) for
electing 501(c)(3) organizations are as follows:
20% of the first $500,000 of total exempt-purpose expenditures of
the organization, then
15% of the next $500,000 in exempt-purposes expenditures, then
10% of the next $500,000 in exempt-purpose expenditures, and then
5% of the organization’s exempt-purpose expenditures over
up to a total expenditure limit of $1,000,000 on lobbying activities.
There is currently a separate “grass roots” expenditure limit of 25%
of the “direct” lobbying limits.4
The activities covered under the tax code limitations on “lobbying” by charitable
organizations generally encompass both “direct” lobbying as well as “grass roots”
lobbying (for which there is a separate included expense limitation). “Direct”
lobbying entails direct communications to legislators, and to other government
officials involved in formulating legislation (as well as direct communications to an
organization’s own members encouraging them to communicate directly with
legislators), which refer to and reflect a particular view on specific legislation.
Indirect or “grass roots” lobbying involves advocacy pleas to the general public
which refer to and take a position on specific legislation, and which encourage the
public to contact legislators to influence them on that legislation.
26 U.S.C. § 501(c)(3). The Supreme Court has upheld the loss of the special tax-exempt
status of charitable, 501(c)(3) organizations if they engage in “substantial” lobbying. Regan
v. Taxation With Representation of Washington, 461 U.S. 540 (1983). The Court noted that
although lobbying is a protected First Amendment right, and although the Government may
not indirectly punish an organization for exercising its constitutional rights by denying
benefits to those who exercise them, lobbying activities are not necessarily one of the
contemplated “exempt functions” of these charitable or educational organizations for which
they have received the preferred tax status. Since contributions to the 501(c)(3) organization
by private individuals are eligible for a deduction from the donor’s federal income tax, the
Government is in effect “subsidizing” those private contributions to the organization
(through loss of tax revenue), and the Court found that Congress does not have to
“subsidize” such lobbying activities through preferred tax status for contributions if it does
not chose to do so, as long as other outlets for the organization’s unlimited, protected First
Amendment expression exist. Id. at 544-546.
Religious organizations are not permitted to make the election to come within the specific
monetary lobbying guidelines under 26 U.S.C. § 501(h), 26 U.S.C. § 501(h)(5). See IRS
Form 5768, for election to come within “expenditure test.”
See 26 U.S.C. § 4911(c)(2).
The definitions of and the specific exemptions from the term “lobbying” are
important in observing the expenditure limitations on an organization’s activities.
For example, not all public “advocacy” activities of an organization are considered
“grass roots lobbying.” As noted expressly by the IRS: “... clear advocacy of specific
legislation is not grass roots lobbying at all unless it contains an encouragement to
action.”5 Furthermore, not all communications to legislators are considered “direct
lobbying.” The definition of “lobbying” for purposes of the tax code limitations
expressly exempt activities such as:
(a) making available nonpartisan analysis, study or research involving
independent and objective exposition of a subject matter, even one that takes a
position on particular legislation as long as it does not encourage recipients to
take action with respect to that legislation;
(b) technical advice or assistance given at the request of a governmental body;
(c) so-called “self-defense” communications before governmental bodies, that is,
communications on those issues that might affect the charity’s existence, powers,
duties, tax-exempt status, or deductibility of contributions to it; and
(d) contacts with officials unrelated to affecting specific legislation, even those
that involve general discussions of broad social or economic problems which are
the subject of pending legislation.6
Section 501(c)(4) Civic Organizations
Organizations which are tax exempt under section 501(c)(4) of the Internal
Revenue Code are generally described as “[c]ivic leagues or organizations not
operated for profit but operated exclusively for the promotion of social welfare ....”
If a civic league or social welfare organization is tax exempt under § 501(c)(4) of the
Internal Revenue Code, there is generally no tax consequence for lobbying or
advocacy activities (as long as such expenditures are in relation to their exempt
function). In fact, in upholding the limitations on lobbying by 501(c)(3) charitable
organizations against First Amendment challenges, the Supreme Court noted that a
501(c)(3) organization could establish a 501(c)(4) affiliate through which its First
Amendment expression could be exercised through unlimited lobbying and
advocacy.7 The 501(c)(4) affiliate should be separately incorporated, keep separate
books, and spend and use resources which are not part of or otherwise paid for by the
tax-deductible contributions to the 501(c)(3) parent organization.8 While 501(c)(4)
1990-39 Internal Revenue Bulletin, at p. 7. A communication “encourages a recipient to
take action” if it (1) states that the recipient should contact legislators; (2) provides a
legislator’s phone number, address, etc; (3) provides a petition, tear-off postcard, or similar
material to send to a legislator; or (4) specifically identifies a legislator who is opposed, in
favor, or undecided on the specific legislation, or is on the committee considering the
legislation, if the communication itself is “partisan” in nature and can not be characterized
as a full and fair exposition of the issue. Id. at 7.
26 U.S.C. § 4911(d)(2); 26 C. F. R. § 56.4911-2(c)(1) - (4).
Regan v. Taxation With Representation of Washington, supra at 544-546 (Opinion of the
Court), see also 552-553 (Blackmun concurring).
See discussion of a 501(c)(3) setting up a 501(c)(4) lobbying affiliate in Smucker, The
organizations’ lobbying activities are generally unrestricted, if a 501(c)(4)
organization receives federal funds in the form of a “grant” or loan, then there are
express restrictions on its “lobbying activities,” discussed below.
Section 501(c)(5) Labor Organizations
and 501(c)(6) Trade Associations
Labor and agricultural organizations are tax-exempt under section 501(c)(5) of
the Internal Revenue Code, and business trade associations and chambers of
commerce are exempt from federal income taxation under section 501(c)(6). Neither
labor or agricultural organizations, nor business trade associations or chambers of
commerce, have any specific limitations upon their lobbying activities as a result of
their tax-exempt status.9
Veterans’ Organizations - Section 501(c)(19)
Veterans’ organizations are in a unique situation concerning lobbying, as
compared to other non-profits, in that veterans’ groups may engage in unlimited
lobbying activities relevant to their functions, while at the same time are able to
benefit from contributions to them that are tax deductible to the donor.10 This
preferred tax position available only to veterans’ groups has been justified as a policy
choice of Congress to benefit those that have served the nation in its armed forces.11
Private foundations (as opposed to “public” charities) are generally restricted
from lobbying, in a practical sense, by tax provisions which penalize expenditures
by the private foundation for most forms of lobbying activities (although the law
expressly exempts from the definition of lobbying such activities as issuing
“nonpartisan analysis, study or research,” and engaging in so-called “self-defense”
lobbying).12 Private foundations differ from public charities generally in the manner
in which they are funded, in that private foundations receive a certain percentage of
their funds from other than contributions from the general public or from the
Government, and instead receive large bequests from those associated with the
Nonprofit Lobbying Guide, Second Edition, 68-69 (Independent Sector 1999).
Note, however, pass-through rules concerning reporting requirements and non-deductibility
as business expenses of dues paid to associations which lobby. Omnibus Budget
Reconciliation Act of 1993, 26 U.S.C § 162(e)(3), 26 U.S.C. § 6033(e)(1). See discussion
in Hopkins, The Law of Tax-Exempt Organizations, 8th Edition, § 20.8 (2003).
26 U.S.C. § 501(c)(19) (describing veterans’ organizations); 26 U.S.C. § 170(c)(3),
2055(a)(4), 2522(a)(4)(tax deductibility of contributions to veterans’ groups).
Regan v. Taxation With Representation of Washington, supra at 550.
26 U.S.C. § 4945(d),(e).
foundation and/or receive substantial amounts of their revenue from the investment
income from the foundation’s financial holdings.13
Receipt of Federal Funds
501(c)(4) Organizations Receiving Federal Grants
Restrictions on “lobbying activities” by certain non-profit groups, as a condition
to receiving federal grants and loans, were enacted into law in 1995. Section 18 of
the Lobbying Disclosure Act of 199514 places statutory restrictions upon the lobbying
activities of non-profit civic and social welfare organizations which are tax-exempt
under section 501(c)(4) of the Internal Revenue Code. This provision, which is
commonly called the “Simpson Amendment,” prohibits section 501(c)(4) civic
leagues and social welfare organizations from engaging in any “lobbying activities,”
even with their own private funds, if the organization receives any federal grant, loan,
The restrictions of the Simpson Amendment originally covered all 501(c)(4)
organizations which received federal monies by way of an “award, grant, contract,
loan or any other form.”16 The term “contract,” however, was subsequently removed
from the provision by P.L. 104-99, Section 129, leaving the prohibition on lobbying
activities with an organization’s own funds as a condition to the receipt of federal
moneys only upon 501(c)(4) grantees and those seeking an award or loan, but
allowing unlimited lobbying activities with organizational funds for 501(c)(4)
contractors of the federal government. The Simpson Amendment now reads: “An
organization described in section 501(c)(4) of the Internal Revenue Code of 1986
which engages in lobbying activities shall not be eligible for the receipt of Federal
funds constituting an award, grant, or loan.”
The legislative history of the provision clearly indicates that a 501(c)(4)
organization may separately incorporate an affiliated 501(c)(4), which would not
receive any federal funds, and which could engage in unlimited lobbying.17 The
method of separately incorporating an affiliate to lobby (or to receive and administer
federal grants), which was described by the amendment’s sponsor as “splitting,” was
apparently intended to place a degree of separation between federal grant money and
private lobbying, while permitting an organization to have a voice through which to
exercise its protected First Amendment rights of speech, expression and petition.18
26 U.S.C. § 509.
P.L. 104-65, 109 Stat. 691, 703-704, as amended by P.L. 104-99, Section 129, 110 Stat.
See now 2 U.S.C. § 1611.
P.L. 104-65, Section 18, 109 Stat. 704 (emphasis added).
H.Rept. 104-339, 104th Congress, 1st Session, at 24 (1995).
See comments by the sponsors of provision, Senator Simpson and Senator Craig, at 141
As stated by Senator Simpson: “If they decided to split into two separate 501(c)(4)’s,
they could have one organization which could both receive funds and lobby without
It may also be noted that while § 501(c)(4)s which receive certain federal funds
may not engage in “lobbying activities,” the term “lobbying activities” as used in the
“Simpson Amendment” prohibition in Section 18 of the Lobbying Disclosure Act is
defined in Section 3 of that legislation to include only direct “lobbying contacts and
efforts in support of such contacts” such as preparation, planning, research and other
background work intended for use in such direct contacts.20 A “lobbying contact”
under the Lobbying Disclosure Act is an “oral or written communication (including
an electronic communication) to a covered executive branch official or a covered
legislative branch official” which concerns the formulation, modification or adoption
of legislation, rules, regulations, policies or programs of the Federal Government.21
Organizations which use their own private resources to engage only in “grass roots”
lobbying and public advocacy (including specifically any communication that is
“made in a speech, article, publication or other material that is distributed and made
available to the public, or through radio, television, cable television, or other medium
of mass communication”)22 would, therefore, not appear to be engaging in any
prohibited “lobbying activities” under this provision. The Lobbying Disclosure Act’s
definitions of “lobbying activities” and “lobbying contacts” exclude, and do not
independently apply to activities which consist only of “grass roots” lobbying and
Similarly, since the term “lobbying activities” relates only to the direct lobbying
of covered federal officials, the “Simpson Amendment” would not appear to limit in
any way an organization’s use of its own private resources to lobby state or local
legislators or other state or local governmental bodies or units. While direct
lobbying of the Congress, or of certain high level executive branch officials, is
covered under the Lobbying Disclosure Act as a “lobbying contact,” and thus by
definition a “lobbying activity,” the acts of testifying before a congressional
committee, subcommittee, or task force, or of submitting written testimony for
inclusion in the public record of any such body, or of responding to notices in the
Federal Register or other such publication soliciting communications from the public
Congressional Record 20041-20042, 20052-20053 (July 24, 1995).
141 Congressional Record, supra at 20045 (Senator Simpson), see also Senator
Simpson’s explanation of “splitting,” id. at 20052, 20053.
2 U.S.C. § 1602(7), P.L. 104-65, Section 3(7).
2 U.S.C. § 1602(8), P.L. 104-65, Section 3(8).
Note this express exception to the term “lobbying contact,” at 2 U.S.C. § 1602(8)(B)(iii),
P.L. 104-65, Section 3(8)(B)(iii).
Broader limitations on public “advocacy” and lobbying by organizations receiving federal
grant money, and on entities wishing to do business with federal grantees, which had been
considered by the House as appropriations riders in the 104th Congress (commonly known
as the “Istook Amendment,” e.g., H.R. 2127, 104th Congress, H.J.Res. 114, 104th Congress),
were not enacted into law.
to an agency, or responding to any oral or written request from a Government official
for information, are expressly exempt from the definition of a “lobbying contact,”
and thus in themselves can not qualify as a “lobbying activity.”24
Restrictions on Use of Federal Funds Generally
Broad prohibitions on the use of federal monies for lobbying or political
activities have been in force for a number of years. Express restrictions on the use
of grant funds by non-profit organizations were adopted in 1984 as part of uniform
cost principles for non-profit organizations issued by the Office of Management and
Budget (OMB) in OMB Circular A-122, and are now incorporated into the Federal
Acquisition Regulations. Under current federal provisions, no contractor or grantee
of the federal government, regardless of tax status, may be reimbursed out of federal
contract or grant money for their lobbying activities, or for political activities, unless
authorized by Congress.25 These restrictions generally apply to attempts to influence
any federal or state legislation through direct or “grass roots” lobbying campaigns,
political campaign contributions or expenditures, but exempt any activity authorized
by Congress, or when providing technical and/or factual information related to the
performance of a grant or contract when in response to a documented request.
In addition to these restrictions of general applicability on the use of federal
contract or grant money for lobbying activities, there may be specific statutory
limitations and prohibitions on particular federal moneys or on particular federal
programs.26 Appropriation riders, for example, may also expressly limit the use of
federal monies appropriated in a particular appropriations law for lobbying, or
“publicity or propaganda” campaigns directed at Congress by private grant or
Under the provisions of federal law commonly referred to as the “Byrd
Amendment,” federal grantees, contractors, recipients of federal loans or those with
cooperative agreements with the federal government, are expressly prohibited by law
from using federal monies to “lobby” the Congress, federal agencies, or their
employees, with respect to the awarding of federal contracts, the making of any
grants or loans, the entering into cooperative agreements, or the extension,
modification or renewal of these types of awards.28 Federal contractors, grantees and
those receiving federal loans and cooperative agreements must also report lobbying
expenditures from non-federal sources which they used to obtain such federal
See 2 U.S.C. 1602(8)(B), for list of 18 exceptions to the term “lobbying contacts.”
Federal Acquisition Regulations (FAR), 48 C.F.R. §§ 31.205-22; 31.701 et seq.,
encompassing principles in OMB Circular A-122, ¶B21, as added 49 F.R. 18276 (1984).
See, e.g, 42 U.S.C. § 2996(f)(a)(5), re Legal Services Corporation contractors and
Note discussion of anti-lobbying appropriations provisions and grant funds in Government
Accountability Office, Principles of Federal Appropriations Law, Vol. I, at 4-219 to 4-227
(Third Ed. January 2004).
31 U.S.C. § 1352(a).
program monies or contracts.29 Agencies of the Federal Government which
administer loans, grants and cooperative agreements have issued common regulations
implementing the “Byrd Amendment.”30 The restrictions of the “Byrd Amendment”
apply to the making, with an intent to influence, any communications to or
appearances before Congress or an agency on a covered matter. Any “information
specifically requested by an agency or Congress is allowable at any time,”31 and
certain other contacts are allowable depending on the timing and nature of the
communication with respect to a particular solicitation for a federal grant, contract
In 2002 a federal statute in the criminal code concerning lobbying with
appropriated funds was amended to expand its applicability and prohibition beyond
merely officers and employees of the Federal Government, while substituting civil
fines for the former criminal penalties for violations of the law. That provision of
law, at 18 U.S.C. § 1913, prohibits the use of federal appropriations to pay for any
“personal services, advertisement, telegram, telephone, letter, printed or written
matter ... intended or designed to influence” Members of Congress, or officials of any
governmental units, on policies, legislation or appropriations.32 Originally enacted
in 1919, the law had applied only to the use of federal funds by officers and
employees of the Federal Government, and had extended its prohibitions only to the
use of such funds for certain lobbying campaigns directed at Congress.33 However,
after the 2002 amendments the law now appears to apply to recipients of all federal
monies appropriated by Congress, and extends its prohibitions to activities to
influence not only the Congress, but also public officials at all levels of
Government.34 Contractors and grantees of the Federal Government may not seek
reimbursement from a federal grant or contract for, nor charge off to a federal
contract or grant, the costs of lobbying and similar public policy advocacy.
31 U.S.C. § 1352(b).
55 F.R. 6735-6756 (February 26, 1990).
55 F.R. 6739.
18 U.S.C. § 1913, as amended by P.L. 107-273, § 205(a); 116 Stat. 1778, November 2,
See Section 6 of the Third Deficiency Appropriations Act, FY1919, 41 Stat. 68, chapter
6, § 6, July 11, 1919. As to its applicability only to federal employees, see Grassley v. Legal
Services Corporation, 535 F.Supp. 818, 826 n.6 (S.D. Iowa 1982). While the new law
eliminates the criminal penalties and substitutes civil fines, there is no indication that
anyone had ever been indicted under the provision from its enactment in 1919 to its
amendment in 2002.
Certain exceptions are provided for federal employees communicating directly to officials
concerning the need for legislation or appropriations, and the possibility of a national
security or defense exemption.
Required Disclosures of Lobbying Activities
Lobbying Disclosure Act of 1995, as Amended
Organizations which engage in a particular amount of lobbying activities (which
must include more than one direct lobbying contact of a covered federal official)
through personnel compensated to lobby on the organization’s behalf will be required
to register and to file disclosure reports under the Lobbying Disclosure Act of 1995,
as amended.35 Other than for tax-exempt religious orders, churches, and their
integrated auxiliaries (which are exempt from registration, reporting, and disclosure
under the Lobbying Disclosure Act36), there is no general exclusion or exception
from the disclosure and registration requirements for other non-profit organizations
which otherwise meet the thresholds on lobbying contacts and overall expenditures
for lobbying activities.
The Lobbying Disclosure Act of 1995 was intended to reach so-called
“professional lobbyists,” that is, those who are compensated to engage in lobbying
activities on behalf of an employer or on behalf of a client.37 When registration is
required for organizations which engage in covered “lobbying contacts” through their
own staff, such registration is done by the organization, rather than by the individual
employee/lobbyist. That is, the organization which has employees who qualify as
“lobbyists” for the organization (so-called “in-house” lobbyists) must register and
identify its employees/lobbyists.38 All lobbying registrations and reports are to be
filed electronically, and may now be filed at a single location for both the Secretary
of the Senate’s Office and the Office of the Clerk of the House.39
An organization will be required to register its employee/lobbyists when it meets
two general conditions. First, it must have one or more compensated employees who
engage in covered “lobbying,” that is, who make more than one “lobbying contact,”
and who spend at least 20% of their total time for that employer on “lobbying
activities” over a three-month reporting period.40 A “lobbying contact” (in reference
to the requirement that an employee/lobbyist make more than one “lobbying contact”
per quarter) is a direct oral or written communication to a covered official, including
a Member of Congress, congressional staff, and certain senior executive branch
P.L. 104-65, 109 Stat. 691, December 19, 1995, as amended by the Lobbying Disclosure
Technical Amendments Act, P.L. 105-166, April 6, 1998, and the “Honest Leadership and
Open Government Act of 2007,” P.L. 110-81, 121 Stat. 735, September 14, 2007.
See exemptions from definition of covered “lobbying contact,” 2 U.S.C. §
1602(8)(B)(xviii), for churches and religious orders that are exempt from filing federal
income tax returns under 26 U.S.C. § 6033(a)(2)(A).
H.Rept. 104-339, 104th Cong., 1st Sess. at 2 (1995).
2 U.S.C. §1603(a)(2). If an organization hires an outside lobbyist or lobbying firm, then
that outside lobbyist, if meeting the income and activities thresholds, must register as a
lobbyist and list the organization as a “client.” 2 U.S.C. § 1603(a)(1), (3).
For instructions and forms, see [http://lobbyingdisclosure.house.gov/index.html].
2 U.S.C. § 1602(10).
officials, with respect to the formulation, modification or adoption of a federal law,
rule, regulation or policy.41 The term “lobbying activities” (in reference to the 20%
time threshold), however, is broader than “lobbying contacts,” and includes
“lobbying contacts” as well as background activities and other efforts in support of
such lobbying contacts.42
Secondly, for an organization to register its
lobbyists/employees, the organization must have spent, in total expenses for such
“lobbying activities,” $10,000 or more in a quarterly reporting period.43 The $10,000
amount will include any money paid to an outside lobbyist to lobby on the
organization’s behalf during the reporting period. If an organization hires an outside
lobbyist, then that outside lobbyist or outside lobbying firm will register on behalf of
that client/organization when the lobbyist or lobbying firm meets the required
threshold for contacts and income, and will identify that organization as a “client.”44
Under the act, a “lobbyist” needs to be registered within 45 days after first
making a lobbying contact or being employed to make such a contact. Registration
will be with the Clerk of the House who will forward such registration to the
Secretary of the Senate. The information on the registrations will generally include
identification of the lobbyist, or organization with employees/lobbyists; the client or
employer; an identification of any foreign entity, and disclosure of its contributions
of over $5,000, if the foreign entity owns 20% of the client and controls, plans, or
supervises the activities of the client, or is an interested affiliate of the client; and a
list of the “general issue areas” on which the registrant expects to engage in lobbying,
and those on which he or she has already lobbied for the client or employer.45 In
addition to listing the “client” of a lobbyist in the case of, for example, a “coalition”
or association which hires a lobbyist, identification must also be made of any
organization other than that client-coalition which contributes more than $5,000 for
the lobbying activities of the lobbyist in a three-month reporting period and “actively
participates” in the planning, supervision, or control of the lobbying activities.46
In addition to the registration of lobbyists, quarterly and semi-annual reports are
required to be filed. The quarterly reports are to cover the periods January 1 - March
31, April 1 - June 30, July 1 - September 30, and October 1 - December 31. These
reports are to be filed within 20 days of the end of the applicable period, and will
identify the registrant/lobbyist, identify the clients, and provide any needed updates
2 U.S.C. § 1602(8)(A).
2 U.S.C. § 1602(7).
2 U.S.C. § 1603(a)(3)(A)(ii). The threshold amount is adjusted every four years, 2 U.S.C.
An outside lobbyist needs to register for a particular client when it makes more than one
lobbying contact with a covered official, and when its total income from that client for
lobbying related matters exceeds $2,500, in a three month (quarterly) filing period. 2 U.S.C.
2 U.S.C. § 1604(b).
2 U.S.C. § 1603(b)(3), as amended by P.L. 110-81, Section 207. There are certain
exceptions to listing separately participating organizations if such groups are listed publicly
on the coalition’s website (unless the organization plans, supervises or controls the activities
of the coalition, and then it must be listed in the registration statement).
to the information in the registration; identify the specific issues upon which one
lobbied, including bill numbers, earmarks, and any specific executive branch actions;
employees who lobbied; Houses of Congress and federal agencies contacted; any
covered interest of a foreign entity; and provide a good faith estimate of lobbying
expenditures (by organizations using their own employees to lobby), or income from
clients (estimated by outside lobbying firms/practitioners) in excess of $5,000 (and
rounded to the nearest $10,000.47 The semi-annual reports are to identify the names
of all political committees established or controlled by the lobbyist or registered
organization; the name of each federal candidate or officeholder, leadership PAC, or
political party committee to which contributions of more than $200 were made in the
semi-annual period; the date, recipient, and the amount of funds disbursed: (i) to pay
the costs of an event to honor or recognize a covered government official; (ii) to an
entity that is named for a covered legislative branch official, or to a person or entity
“in recognition” of such official; (iii) to an entity established, maintained, or
controlled by a covered government official, or an entity designated by such official;
and (iv) to pay the costs of a meeting, conference, or other similar event held by or
in the name of one or more covered government officials, unless the events, expenses
or payments are in a campaign context such that the funds provided are to a person
required to report their receipt under the Federal Election Campaign Act (2 U.S.C.
§ 434). The name of each presidential library foundation and each presidential
inaugural committee to whom contributions of $200 or more were made in the semiannual reporting period must also be reported.48 Additionally, in the semi-annual
reports registrants are required to provide a certification that the person or
organization filing (i) “has read and is familiar with” the rules of the House and
Senate regarding gifts and travel, and (ii) had not provided, requested, or directed that
a gift or travel be offered to a Member or employee of Congress “with knowledge
that the receipt of the gift would violate” the respective House or Senate rule on gifts
The Lobbying Disclosure Act, in addition to covering only those who are
compensated to lobby, as a prerequisite to coverage applies only to those whose
activities may be described as “direct” lobbying, that is, direct communications or
contacts with covered officials. The registration and disclosure requirements of the
law are not separately triggered by “grass roots” lobbying by persons or
organizations. That is, an organization or entity which engages only in grass roots
lobbying, regardless of the amount of “grass roots” lobbying activities, will not be
required under the Lobbying Disclosure Act provisions to register its members,
officers or employees who engage in such activities.50
2 U.S.C. § 1604(a)-(c), as amended by P.L. 110-81, Sections 201(a) and 202.
2 U.S.C. § 1604(d), as added by P.L. 110-81, Section 203.
2 U.S.C. § 1604(d)(1)(G), as added by P.L. 110-81, Section 203.
Specifically excluded from the definition of a “lobbying contact” is any communication
“made in a speech, article, publication or other material that is distributed and made
available to the public, or through radio, television, cable television, or other medium of
mass communication.” 2 U.S.C. § 1602((8)(B)(iii).
The Lobbying Disclosure Act also exempts from the definition of “lobbying
contacts” the activities of lobbying state or local legislators or other state or local
governmental bodies or units. Furthermore, while direct lobbying of Congress, or
of certain high level executive branch officials, is covered under the Lobbying
Disclosure Act as a “lobbying contact,” the acts of testifying before a congressional
committee, subcommittee, or task force, or of submitting written testimony for
inclusion in the public record of any such body, or of responding to notices in the
Federal Register or other such publication soliciting communications from the public
to an agency, are expressly exempt from the definition of a “lobbying contact,” and
thus in themselves cannot qualify as a “lobbying activity.”51
Certain public charities, that is, those that have “elected” the specific
expenditure limit test for lobbying under 26 U.S.C. § 501(h), will have the option,
under the Lobbying Disclosure Act, of using the Internal Revenue Code definitions
of “influencing legislation,” rather than the Lobbying Disclosure Act definitions of
“lobbying activities” to determine the organization’s reporting obligations.52 This
option was provided so that such groups would need to have only one set of internal
record controls and standards dealing with “influencing legislation” under both the
tax code and the lobbying disclosure law.53 Since the definition of “influencing
legislation” under the tax code is different than the definition of “lobbying activities”
under the lobbying law, an eligible organization may need to decide which definition
is more advantageous to use, from both a tax and record-keeping standpoint, as well
as in relation to the extent and nature of its planned public policy activities.54
Tax Code Disclosures
Most tax-exempt, non-profit organizations (other than churches) having annual
gross receipts of over $25,000 must file with the IRS a Form 990 which is open to
public inspection. Charitable 501(c)(3) organizations must also file Schedule A with
Form 990, providing the reporting of lobbying expenditures, that is, expenses for
“influencing legislation” under the Internal Revenue Code definitions. “Electing”
organizations (electing the “expenditure test” for lobbying limits under 26 U.S.C. §
501(h)) must also compute and allocate expenses attributable to “grassroots”
lobbying, as well as to “direct” lobbying; but non-electing organizations (under the
“substantial part” test) must provide to the IRS a “detailed” description of their
lobbying activities, information not required from “electing” organizations.
See 2 U.S.C. 1602(8)(B), P.L. 104-65, Section 3(8)(B) for list of 18 express exceptions
to the term “lobbying contacts.”
2 U.S.C. § 1610(a),(c).
H.Rept. 104-339, supra at 23.
For a discussions of several considerations, see Richard L. Winston, “The Lobbying
Disclosure Act of 1995 and the Tax Code Elections,” Tax Notes, 1391-1399 (June 3, 1996);
and Robert A. Boisture, Independent Sector, “What Charities Need to Know To Comply
With the Lobbying Disclosure Act of 1995,” in Complying With the Lobbying Disclosure
Act of ‘95 and the New Gift Act Restrictions, 185-208 (Glasser Legal Works, 1996).
Alliance for Justice, Worry-Free Lobbying for Nonprofits: How to Use the 501(h)
Election to Maximize Effectiveness, 1999, 2003.
Robert A. Boisture, for Independent Sector, “What Charities Need to Know To
Comply With the Lobbying Disclosure Act of 1995,” in Complying With the
Lobbying Disclosure Act of ‘95 and the New Gift Act Restrictions, pp. 185-208
(Glasser Legal Works 1996).
Comment, “Guiding Lobbying Charities Into A Safe Harbor: Final Section 501(h)
and 4911 Regulations Set Limits for Tax-Exempt Organizations,” 61 Miss. L.J. 157
John A. Edie, Foundations and Lobbying: Safe Ways to Affect Public Policy (Council
on Foundations, 1991).
Bruce H. Hopkins, The Law of Tax-Exempt Organizations, Eighth Edition (2003).
Bruce R. Hopkins, Charity, Advocacy and the Law (1992).
Bob Smucker, The Non-Profit Lobbying Guide, Second Edition, 1999 (Charity
Lobbying in the Public Interest, Independent Sector).
Richard L. Winston, “The Lobbying Disclosure Act of 1995 and the Tax Code
Elections,” Tax Notes, 1391-1399 (June 3, 1996).
U.S. House of Representatives, Office of the Clerk, “Guide to the Lobbying
Disclosure Act,” December 2007 (amended January 25, 2008).
CRS Report 96-264. Frequently Asked Questions About Tax-Exempt Organizations,
by Erika Lunder.
CRS Report RL31126. Lobbying Congress: An Overview of Legal Provisions and
Congressional Ethics Rules, by Jack Maskell.