Yes, Your Nonprofit Can Lobby: Here’s How to do it Legally and Effectively
Kelly Faley, Grants Specialist, Wastyn & Associates
When people think of lobbying, they often envision well-funded interest groups, not local nonprofits fighting for community change. But nonprofits often serve on the front lines, helping our most vulnerable populations and deeply understanding the issues that hold people back and let them thrive.
Nonprofits have every right to lobby legislators—and they should.
When done within legal limits, lobbying serves as an essential strategy for driving meaningful policy change. Whether advocating for mental health funding, environmental protections, or education reform, your organization, its staff, board, and volunteers have an important voice.
Nonprofits & Lobbying: What the Law Says
Contrary to popular belief, 501(c)(3) charitable organizations can lobby. Both Congress and the IRS explicitly permit it, as long as lobbying does not constitute a “substantial part” of the organization’s activities. They measure nonprofit lobbying activity in two ways:
The “Substantial Part” Test: A subjective approach based on how much time and resources your nonprofit devotes to lobbying. This vague requirements leaves the specifics open to interpretation, which makes many organizations cautious.
The 501(h) Election: By filing IRS Form 5768, your nonprofit can opt into the 501(h)-expenditure test that spells out exactly how much you can spend on lobbying based on your budget:
The 501(h)-expenditure test often becomes the best option if your nonprofit plans to lobby regularly. It offers clarity, legal protection, and simplified IRS reporting.
Two Powerful Forms of Lobbying
Let’s explore two effective and legal ways to influence public policy.
Direct Lobbying involves contacting legislators directly and urging them to support or oppose specific bills. You can find your representatives and senators online. Their offices remain open to receiving questions or comments regarding legislation or public policy. Remember, they work for you.
Grassroots Lobbying involves encouraging the public to contact lawmakers about specific legislation, for example, sending an email to your contact list asking supporters to call their state representative about a proposed funding cut.
Stay Compliant: Know the Rules
To lobby safely and strategically:
Report lobbying expenditures on your IRS Form 990 annually.
Use Form 5768 to simplify tracking and reporting under the 501(h) election.
Avoid partisan politics. Nonprofits are strictly prohibited from supporting or opposing political candidates.
Private foundation have stricter rules that prohibit direct and grassroots lobbying. However, they can fund nonpartisan research and public education.
Why Lobbying Matters for Your Mission
Too many nonprofits avoid lobbying because they assume it is not allowed. In doing so, they miss a powerful opportunity to shape the laws and budgets that affect the very communities they serve.
Whether you’re a small community-based nonprofit or a large regional organization, lobbying can become a vital tool to advance your mission. Embrace it and assure that your voice and the voice of your constituents gets heard.
This blog does not constitute legal advice. Please consult your attorney or accountant to assure that your organization stays in compliance with its lobbying or advocacy work.
