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BLOG / 10.29.19 /Nancy Durand

The Johnson Amendment Finds Refuge Under New York Law

On October 23, 2019, Governor Cuomo signed legislation that restricts the ability of certain nonprofit corporations to participate or intervene in any political campaign on behalf of or against a candidate for public office. The new legislation codifies the federal Johnson Amendment, which is a provision in the U.S. tax code that prohibits all 501(c)(3) nonprofit organizations from endorsing or opposing political candidates. This measure was taken amidst concerns that the Trump administration and certain members of Congress were seeking to repeal the Johnson Amendment. By codifying the Johnson Amendment into New York law, even if the Johnson Amendment is repealed at the federal level, New York nonprofits would still be prohibited from engaging in certain political activity.

Nonprofits are reminded that all 501(c)(3) organizations are absolutely prohibited from directly or indirectly participating or intervening in any political campaign for public office. This includes making any financial contributions to campaign funds or any public statements of position either for or against a candidate for public office. Engaging in such prohibited political activities places the nonprofit at risk of revocation of its tax-exempt status and imposition of certain excise taxes.

But not all political activity is prohibited.

Nonprofits may engage in a variety of nonpartisan political activities, such as sponsoring voter education and registration drives, publishing voter education guides, publishing broad “issue guides,” and other nonpartisan voter education activities. Ultimately, whether an organization is engaged in prohibited political activity, either directly or indirectly, depends on the facts and circumstances of each case.