Explaining The Differences Between 501(c)3 And 501(c)4 Non-Profits
A band of activists is trying to organize Florida education groups toward a common purpose.
To do so they are forming two non-profit groups, one a 501(c)3 and the other a 501(c)4. What does that mean?
Under Internal Revenue Service rules, a 501(c)3 is a non-profit for religious, charitable or educational purposes. These types of non-profits typically conduct research and can only engage in a limited amount of lobbying, advocacy or political activity.
Donations to 501(c)3 groups are tax-deductible.
A 501(c)4 is a social welfare group and can engage in more advocacy and lobbying. A U.S. Supreme Court ruling allows businesses and unions to donate unlimited money to 501(c)4 groups, and they can be tied to so-called “super PACs” which raised and spent millions on political advocacy during the 2012 election.
Donations to 501(c)4 groups are not tax-deductible, and donors are often not disclosed.
The activists are basing their new groups on two foundations started by former Gov. Jeb Bush.
The Foundation for Excellence in Education is a 501(c)3. This group focuses on national education policy, conducts research and staff has traveled around the country to tout the benefits of specific policies – usually ideas Bush put into place while governor.
The Foundation for Florida’s Future is a 501(c)4 and focuses on advocacy on education issues within Florida.