Internal Revenue Service
Revenue Ruling
Rev. Rul. 67-71
1967-1 C.B. 125
Sec. 501
IRS Headnote
A nonprofit organization created to improve a public educational system is
not exempt from Federal income tax under section 501(c)(3) of the Internal
Revenue Code of 1954 where it campaigns on behalf of candidates for
election to the school board.
Full Text
Rev. Rul. 67-71
Advice has been requested whether a nonprofit organization created to
improve a public educational system by engaging in campaigns on behalf of
candidates for the school board may qualify for exemption from Federal
income tax under section 501(c)(3) of the Internal Revenue Code of 1954.
Every four years when the school board is to be elected, the organization
considers the qualifications of all candidates and selects those it
determines to be best qualified. It then engages in a campaign on their
behalf by publicly announcing its slate of candidates and by publishing and
distributing a complete biography of each.
Section 501(c)(3) of the Code provides for the exemption from Federal
income tax of organizations which are organized and operated exclusively
for educational purposes and which do not participate in, or intervene in
(including the publishing or distributing of statements), any political
campaign on behalf of any candidate for public office.
Section 1.501(c)(3)-1(c)(3) of the Income Tax Regulations states that an
organization is not operated exclusively for one or more exempt purposes
described in section 501(c)(3) of the Code if it is an `action'
organization. An `action' organization is defined to include an
organization which participates or intervenes, directly or indirectly, in
any political campaign on behalf of or in opposition to any candidate for
public office. A candidate for a public office is defined as an individual
who offers himself, or is proposed by others, as a contestant for an
elective public office.
A candidate for an elected position on a school board is a candidate for
public office. Furthermore, the organization's activity in evaluating the
qualifications of all potential candidates and then selecting and
supporting a particular slate constitutes participation in a political
campaign on behalf of particular candidates, even though its process of
selection may have been completely objective and unbiased and was intended
primarily to educate and inform the public about the candidates. Therefore,
the organization is not exempt from Federal income tax under section
501(c)(3) of the Code.
