A Short Primer on 501(c)(3) Case Study #1
In Chapter 1, I defined what a 501(c)(3) tax exempt organization is and in Chapter 2 I provided some details about the restriction on “political activity” that a 501(c)(3) organization is expected to live under. I think I’ve presented enough information to take some time and look at a specific example.
Case Study #1: MinnPost.com
From their website,
MinnPost is a nonprofit journalism enterprise that publishes MinnPost.com and MinnPost in Print.
They are also organized as a 501(c)(3) tax exempt charitable organization. This is the exact same tax status as a church or other religious organization.
MinnPost’s funding as described by their website:
MinnPost’s initial funding of $850,000 came from four families: John and Sage Cowles, Lee Lynch and Terry Saario, Joel and Laurie Kramer, and David and Vicki Cox. The Knight Foundation in Miami then committed $250,000. As of Nov. 7, 2007, MinnPost had raised more than $134,000 in additional support from more than 340 donors.
That’s over $1.2 million in tax deductible donations, which represents about $300K in tax savings (or tax revenue lost).
On Feb 4, 2008 (during an election year), MinnPost.com posted the following articles.
Inspiration issue tops competence in making my choice By Becky Lourey
Five reasons why Obama’s my choice By Lynnell Mickelsen
These articles can be found HERE . Both articles give reasons why the authors have chosen to vote for Obama for president in the upcoming 2008 election. In other words, these articles contain statements in favor of a candidate for public office as well as statements in opposition to candidates.
Does this constitude “political activity” by MinnPost? My next installment will look at this further, with some feedback from MinnPost editor and CEO Joel Kramer.