Forum:The 501(c)3-thing

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As an offshoot of the recent coop case against LogicMaster777, an issue was raised surrounding RW's status as a U.S. charitable and educational organisation under the 501(c)3:
Do RW's criticism of various (active) U.S. politicians constitute a potential legal hazard?

I've copy/pasted the relevant bits from the coop to get things started, but I'm interested whether some of the legal minds at RW has considered this issue. ScepticWombat (talk) 05:54, 15 March 2015 (UTC)

He may be referring to this section:

...all section 501(c)(3) organizations are absolutely prohibited from directly or indirectly participating in, or intervening in, any political campaign on behalf of (or in opposition to) any candidate for elective public office. Contributions to political campaign funds or public statements of position (verbal or written) made on behalf of the organization in favor of or in opposition to any candidate for public office clearly violate the prohibition against political campaign activity....

Read on. "Contributions" do not necessarily need to be "cash contributions". As an educational foundation the RMF needs to look closely at this language:

... voter education or registration activities constitute prohibited participation or intervention if there is evidence of bias that would:
. Favor one candidate over another
Oppose a candidate in some manner
Have the effect of favoring a candidate or group of candidates

nobsI was in Bagdad when u wer in dadsbag. 22:38, 14 March 2015 (UTC)
No, LM is not objecting to a possible commingling of technical operating funds and a legal defense fund. He is complaining that Rational(hic)Wiki is being unfair to his views by suppressing them, while soliciting funds in support of a neutral apolitical site. As usual, his understanding is flawed. Alec Sanderson (talk) 22:44, 14 March 2015 (UTC)
I'm going to call it "CU's Law"; 'If we can see your complaints about censorship, you're wrong'. Or maybe, 'The amount of censorship actually taking place is inversely proportional to the visible complaints about being censored'. CorruptUser (talk) 22:52, 14 March 2015 (UTC)Editor's note: Included to make sense of my comment below. ScepticWombat (talk) 05:54, 15 March 2015 (UTC)
I like CU's Law. As for Alec Sanderson's and nobs' remarks, I'd say that combined, they illustrate how, where and why LM is wrong (again) about 501(c)s and political bias. The IRS is quite clear that 501(c)s can't engage in political campaigning, whereas LM thinks 501(c)s have to be politically neutral. These are not the same things at all. The IRS guys are quite clear that this is about preventing 501(c)s from "directly or indirectly participating in, or intervening in, any political campaign on behalf of (or in opposition to) any candidate for elective public office." Thus, the prohibition pertains to partisan campaigning not political bias. To make LM's claim even sillier, the bias he has claimed is that RW is "statist/statheist" which I suspect even the best lawyer will be hard pressed to match with something that "(a) would favor one candidate over another; (b) oppose a candidate in some manner; or (c) have the effect of favoring a candidate or group of candidates".
So, LM apparently doesn't understand the 501(c) rules either, and, given that his censorship claims (as per CU's Law and easily observable fact) are bunk, his claim that donors are being misled by RW having a "hidden censorship policy" is equally ludicrous. ScepticWombat (talk) 23:30, 14 March 2015 (UTC)
The WP article is pretty good and pretty clear on the matter (believe it or not), having been denied 501(c)(3) status (educational), one cannot turn around and reapply for 501(c)(4) status (activist). So the question is what protection Sec 230 of the Internet Decency Act afford to the RMF in light of IRC Sec. 501(c)(3) that states, "public statements of position (verbal or written) made on behalf of the organization in favor of or in opposition to any candidate for public office" in reading the Paulbots and associated articles. nobsI was in Bagdad when u wer in dadsbag. 00:50, 15 March 2015 (UTC)
Response to Rob Yeah, good point. Alot of the Ron Paul Bashing would probably be considered "illegal" by IRS lawyers - (No I am not trying to "threaten" to report RW or sue RW). Do you disagree that the principles I enumerate would be implied by the explicit policies?LogicMaster777 (talk) 01:34, 15 March 2015 (UTC)
(ec)Fundamentally, there probably is no Sec. 230 protection for a non-profit when it comes to tax law, but it's an interesting question. By allowing attacks on candidates for office (and as I read the law, a candidate for office includes local dog catcher), a 501(c)(3) violates its "educational" purpose and passes over into "activism". This is why Sec 527 Superpacs were created, to allow "issue advocacy", without overhauling Sec 501, and to discourage negative campaigning and personal attacks. Points 3 and 4 you cited above, I can't hardly believe would even be in question. nobsI was in Bagdad when u wer in dadsbag. 03:00, 15 March 2015 (UTC)

I googled the matter and found only two references by people in the know in the last 6 years (a new congress and administration could change things). They are here and here. The IRS is studying the matter. The second link gives 4 recommendations that should be looked at collectively, but #3 is interesting: "A hosting organization’s role should be limited only to periodic monitoring and not active editing, auditing or supervision, and definitely not screening submissions ..." nobsI was in Bagdad when u wer in dadsbag. 09:57, 15 March 2015 (UTC)

I guess the problem here is what or who counts as a "hosting organization" in the case of RW/RMF? It might mean that, for instance, board members should be careful about what the do, I suppose?
I also found #2 interesting: "Terms of Use should clearly state limitations and restrictions on activities in using the site that would not be permitted by the hosting organization if performed directly, such as electioneering and advocacy." I'm not sure RW (yet) has such a clearly worded disclaimer. ScepticWombat (talk) 11:23, 15 March 2015 (UTC)
The RMF (the group raising the money) is the host, I'm pretty sure. Point 2 is probably pretty good advice from an experienced expert, at least for CYA purposes until the IRS issues further guidelines. And it seems there is very much room for leeway in a vague disclaimer. It's probably more important to have some disclaimer than none at all, is how I read it. My guess is, much of this is silence and inaction on the part of the IRS is probably directly related to Tea Partiers complaints of being denied 501(3)(c) status in recent years, and if a GOP president & congress are elected in 2016 there would be pretty quick, longterm action written into the Internal Revenue Code to give IRS directuon on how to deal with a 501(c)(3) hosting facility's handling of user generated content. nobsI was in Bagdad when u wer in dadsbag. 11:41, 15 March 2015 (UTC)
Considering that no organization 501c3 is liable for what happens on say, its forums, and that wiki software correctly attributes changes and content to users I'd say there's evidence of good faith that the board is not actively promoting a specific political cause. They promote an environment that might lead to contributors doing that in the course of their stated mission, but if audited, I think they'd have a strong case to make. This is, technically speaking, the board's concern, and none of us should be setting or attempting to set policy based on it. ikanreed You probably didn't deserve that 15:59, 15 March 2015 (UTC)
This is not about setting policy, it's about flagging issues of potential concern before they become iffy problems, though possibly the board have already considered these topics. For instance, the disclaimer would clearly need to be written by the "hosting organization", i.e. the board, and my comment was merely meant to highlight that one might be needed, not what its content ought to be (I agree with nobs that vagueness might be a good idea, but that's the board's decision).
Given the notoriously litigious culture of the U.S., I doubt pretending that such problems will never crop up is a prudent strategy. I was also simply curious about how organisations such as wikis might safely navigate the ban on partisan campaigning, given the broad definition of that ban, the writing style on RW, and the nature of user generated content. I'm happy to see that this issue is probably not going to be a huge problem. However, it seems that board members might have to be careful about when and how they engage in conflicts or controversies on RW, but I'm still a bit unsure of that. I'm really relieved that I wasn't eligible for the board and hence doesn't have to worry about it personally, but it's probably a good idea if the board members talk this over and find out if they are under any special constraints (if they haven't done so already, of course). ScepticWombat (talk) 16:48, 15 March 2015 (UTC)

──────────────────────────────────────────────────────────────────────────────────────────────────── There are several things that RMF should pay attention to. In the field of tax law, things are ever changing, and it's my guess there will be further guidance supplied by the IRS in the coming two or three years, as well as changes from Congress. The links above basically are discussing Comments sections on blogs of non-profits. This would be akin to article talk pages on a wiki. Namespace on an open wiki would be a more specialized, and less common form of user generated content. RW now has its mission statement, but experience says there probably should be some "Terms of Usage" (there probably does not have to be an "Accept" or "I Agree" box or anything, as of now) page with language that could be culled from another wiki with user generated mainspace and a less formal Terms of Usage statement (notice I'm avoiding saying "agreement" or "policy", just "Terms of Usage statement", for now). The statement should simply say in effect, "RW is a 501(c)(3) and as such we cannot promote nor oppose candidates for public office", as well as something to the effect of educating people on the vital issues of the day regarding psuedoscience. IOW, enough to discourage somebody with an agenda to use mainspace as a promotion or attack site.

I've seen enough over the years, mostly in the field of labor law and elsewhere, were the failure of a business to have a written policy, statement, or guideline ultimately led to the business getting fucked when it got challenged. nobsI was in Bagdad when u wer swirling in yur Dads' bag. 21:41, 15 March 2015 (UTC)

Basically, not having an official policy is the same as simply delegating the policy-making to the mob. I just want to clarify: I'm NOT saying that by taking a political "side" in itself RW is doing something "illegal" as a 501c agency(aside from arguably the Ron Paul stuff perhaps), but that in my opinion it should be made transparent to donors and as to the policies whether made by mob rule or "official" policies made by the board/bylaws, the donors have a right to know the REAL policies and this should be transparent. "The Mob" has been delegated defacto policy making "powers" for RW/RMF. They collectively act as the effective defacto "executive" and "judicial" branch of the RMF to the board's legislative branch. Really I don't care about strict legalistic adherence to the legal scripture, my issue is with the duplicitous policy positions, to me I think it is not really fair to donors or would-be contributors. Going to contact the RMF, and until I see what the response is (or isn't) I'm going to leave it at that. Till then I'm done commenting on this topic on RW. LogicMaster777 (talk) 17:55, 16 March 2015 (UTC)
What 501(c)3 ultimately means under U.S. Tax law is, while a private entity such as Conservapedia is free to say anything about a living person up to and including slander (assuming they are willing to bare risks of civil damages), RW must pretend to show neutrality toward candidates for public office. Now let's say there's been unsavory information in a non-candidate's bio for ten years and tomorrow he/she decided to run for city council. That bio would probably have to be revised. Conserve pedi a is under no such stricture. nobsI was in Bagdad when u wer swirling in yur Dads' bag. 18:45, 13 April 2015 (UTC)