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Lev, Tax Advisor
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501(c)(3) organizations are prohibited from hosting or supporting

Resolved Question:

501(c)(3) organizations are prohibited from hosting or supporting political events. Is this also true for 501(c)(8) organizations?
Submitted: 2 years ago.
Category: Tax
Expert:  Lev replied 2 years ago.
Hi and welcome to Just Answer!
Please see page 5 in this publication which expresses IRS's position this matter - http://www.irs.gov/pub/irs-tege/eotopicf04.pdf
Political Activity is Not Fraternal. Political activity is not considered a fraternal activity. But engaging in political activity does not, in and of itself, give rise to revocation of exemption. Therefore, a fraternal beneficiary society, so long as it is primarily engaged in fraternal activities and the provision of benefits to its members and their dependents within the meaning of IRC 501(c)(8), may engage in some political activities, including intervention in political campaigns on behalf of, or in opposition to, candidates for public office, without jeopardizing its exempt status. See GCM 34985 (Aug. 10, 1972). Nevertheless, the organization would be subject to tax on its political expenditures under IRC 527(f).

So far...
- IRC 501(c)(8) Fraternal Beneficiary Societies ARE NOT prohibited from hosting or supporting political events.
Let me know if you need any help.
Customer: replied 2 years ago.
If I understand this answer correctly political events are allowed. However, if the fraternal organization excepts money in the form of facility charges the monies received are subject to tax and must be reported to the IRS as income.
Expert:  Lev replied 2 years ago.
The statement from the IRS publication mentioned political expenditures which are subject of tax - means funds SPENT by 501(c)(3) organizations on political activities.

If the organization EARNS the money - it might be subject of tax on Unrelated Business Income - see IRS publication 598 - http://www.irs.gov/pub/irs-pdf/p598.pdf
An activity is an unrelated business if it meets three requirements:
--It is a trade or business,
--It is regularly carried on, and
--It is not substantially related to furthering the exempt purpose of the organization.
Lev, Tax Advisor
Category: Tax
Satisfied Customers: 22703
Experience: Taxes, Immigration, Labor Relations
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