The United States Department of the Treasury and the Internal Revenue Service (IRS) have announced they are issuing initial guidance regarding qualification requirements for tax-exemption as a social welfare organization under section 501(c)(4) of the Internal Revenue Code.
501(c)(4) tax-exempt organizations that operate to promote social welfare are named after the section of the Internal Revenue Code under which they were created, and, to date, have been allowed to engage in political activities (as long as political lobbying is not their primary purpose). Gift tax, currently applied at a 35 percent rate to sums given in excess of USD14,000 per year, has not generally been assessed on donations to such entities.
