IRS: Private Letter RulingsPrivate Letter Rulings Relating to Section 527 Organizations The current controversy over whether certain section 527 organizations should be treated as political committees within the meaning of the Federal Election Commission Act (FECA) arises as a result of the emergence of a new type of section 527 that was carefully designed to satisfy the section 527(e) definition of an exempt function as influencing the outcome of an election while at the same time avoiding the FECA definition of a political committee, which had come to depend on the magic words test for express advocacy. The following private letter rulings from the Internal Revenue Service illustrate the arguments that organizations made to establish that their purpose was to influence the outcome of an election. Such activities as ballot measure initiatives and more conventional legislative lobbying were recharacterized by these new section 527 organizations by passing board resolutions stating that the organization intended to influence the outcome of elections or by securing opinion letters from political scientists that the activity in question would influence the outcome of an election. These activities through which the new section 527s were created are useful in understanding the current controversy over whether such organizations are political committees within the meaning of FECA.
Click here to view the Private Letter Ruling Issued by the IRS on October 1, 1996. Click here to view the Private Letter Ruling issued by the IRS on March 24, 1997. Click here to view the Private Letter Ruling Issued by the IRS on November 21, 1997. Click here to view the Private Letter Ruling Issued by the IRS on March 29, 1999.
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