What is the "Johnson Amendment?"

Section 501(c)(3) of the Internal Revenue Code permits a federal income tax exemption for human service and other qualifying social sector organizations if they comply with certain conditions. These conditions are intended to ensure that exempt organizations are not operated for the benefit of private interests, such as paying out profits to shareholders or other individuals. Another condition, known as the Johnson Amendment, further provides that 501(c)(3) tax-exempt organizations “may not participate in any campaign activity for or against political candidates.” This language protects nonprofits, religious institutions, and foundations from a relatively narrow range of activities which includes endorsing political candidates and donating to political campaigns. The Johnson Amendment does not impose any limitation on the ability for nonprofits to advocate on behalf of social, moral, and public policy issues.

The Johnson Amendment, moreover, does not infringe on the First Amendment rights of any individual or organization. First, the Supreme Court has held that “declining to subsidize” the direct political activities of a nonprofit or religious institution does not infringe an organization’s free speech or freedom of religion. Any nonprofit institution can choose not to incorporate as a 501(c)(3) organization, or can create a separate 501(c)(4) organization to participate in political campaigning. Second, nonprofit and religious leaders are still free to engage in political campaign activities in their capacity as private individuals.

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