501(h) election
A 501(h) election or Conable election is a procedure in United States tax law that allows a 501(c)(3) non-profit organization to participate in lobbying that is limited only by the financial expenditure on that lobbying, regardless of its overall extent. This allows organizations taking the 501(h) election to potentially perform a large amount of lobbying if it is done using volunteer labor or through inexpensive means. The 501(h) election is available to most types of 501(c)(3) organizations that are not churches or private foundations. It was introduced by Representative Barber Conable as part of the Tax Reform Act of 1976 and codified as , and the corresponding Internal Revenue Service (IRS) regulations were finalized in 1990.
501(c)(3) organizations, named after the section of the Internal Revenue Code that defines them, are the most common category of nonprofit organization in the United States. They make up 74% of all tax-exempt organizations as of 2013, encompassing organizations with charitable, educational, or religious missions.
By default, 501(c)(3) organizations are subject to a provision that "no substantial part of the activities [may be] carrying on propaganda, or otherwise attempting, to influence legislation". This test, called the substantial part test, is subjective and not precisely defined by the IRS, making it difficult for organizations engaging in policy advocacy to determine whether they are in compliance with the law. Under the 501(h) election, this is replaced with an objective expenditure test based only on the annual financial expenditure, with no other limits on the actual extent of the lobbying activities. An organization may take the 501(h) election by filing a one-page form with the IRS, which remains in effect until revoked by the organization. The 501(h) election is not available to churches or to private foundations.
...
Wikipedia