March 28, 2010; Asbury Park Press | This is the vulnerability of nonprofits that everyone has to be aware of. Newly elected governor Chris Christie is fighting with the New Jersey Education Association over teachers’ salaries and benefits. No surprise there.
But an op-ed columnist in the Asbury Park Press weighed in with an unusual and inaccurate take on the NJEA’s tax status: “The NJEA is recognized as a nonprofit outfit that is supposed to use its money to serve its members and is not taxed, as if it were a church or a charity. There is no doubt that the NJEA engages in political activity, so maybe someone should take a close look at the NJEA’s tax-exempt status.”
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No, the NJEA isn’t a charity. It’s a tax exempt labor union (501(c)(5)), not a public charity, and is expected to advocate for the interests of its members. But the implicit argument is that public charities are not supposed to engage in political activities.
Wrong. Charities cannot engage in partisan political electioneering, but they can certainly advocate and lobby about public policies. Whenever a newspaper issues broad-brush statements about nonprofits and politics that are clearly wrong, nonprofits ought to take the opportunity to educate about the different kinds of tax exempt organizations permitted under the tax code and the specific advocacy and lobbying rights of 501(c)(3) public charities.—Rick Cohen