Social Welfare Organizations

Because section 501(c)(4) social welfare organizations are not prohibited from engaging in political campaign activity, they have become a more attractive structure for nonprofits that want to be tax-exempt, yet participate in the political system.  Both Congress and the IRS have made recent changes to the ways section 501(c)(4) organizations must notify officials of their existence.  For example, the IRS just released a new application for recognition of exemption under section 501(c)(4) of the Internal Revenue Code (IRS Form 1024-A).  The new Form 1024-A is significantly shorter than the current IRS Form 1023.  Also, Congress now requires a new nonprofit to notify the IRS of its intent to operate as social welfare organizations no later than 60 days after the nonprofit was formed.  The notice is filed on IRS Form 8976.