501(c)(4) organizations can engage in unlimited lobbying so long as it pertains to the organization’s mission. 501(c)(3) organizations are not permitted to engage in political activity, endorse or oppose political candidates, or donate money or time to political campaigns, but 501(c)(4) organizations can do all of the above. In regards to supporting these organizations, donations made to 501(c)(3) organizations are deductible to the full extent of the law as charitable contributions. Donations made to 501(c)(4) organizations are not deductible, though some businesses who make these contributions often write them off as advertising or business expenses.
Americans for Prosperity (AFP), per their latest 990, is 501(c)(4) and takes in over $80 million in contributions and grants. Americans for Prosperity Foundation (AFPF), per their latest 990, is 501(c)(3) and takes in over $20 million in contributions and grants.
I bring this up since AFPF (the ones who can’t engage in political activity) announced on their website today that they are investing six-figures in a pension reform effort in New Jersey.
“New Jersey’s pension crisis threatens the future of families, entrepreneurs, retirees, and government workers. The lack of sustainable funding keeps our tax burden oppressive, crowds out needed services, undermines economic growth, and leaves workers without a secure retirement. Pension reform is a moral imperative and an economic necessity. The longer we wait to shed light on this issue, the more New Jerseyans will suffer from higher taxes, budget cuts to essential services, and defaulting pensions.
“For too long the pension crisis has been ignored because the public did not know the facts. Safeguard New Jersey’s Future will change that by explaining the problem and the commonsense reforms that can safeguard our state’s future for all residents. Pension reform will restore our state’s fiscal health, reverse the perpetual tax hikes, protect essential services, and ensure government workers and retirees’ retirement plans remain secure.”
It would seem as if “higher taxes, budget cuts to essential services, and defaulting pensions” would be the choices before us yet the AFPF link lays out this three-step program:
- Understand the problem
- No higher taxes
- Go to a 401(k) plan
All commendable notions but the problem (in this case a $235 billion problem) persists and it WILL take political activity to address it.