Lobbying Series Part 5 - Recordkeeping

Lobbying Series Part 5 – Recordkeeping  On this episode, our fifth in our on-going lobbying series, we’ll focus on how 501(c)(3) public charities can keep good records of their lobbying and why it is important.  Attorney Co-hosts  Quyen Tu  Tim Mooney  Natalie Ossenfort  Quick reminders: Check out the prior four episodes in our lobbying series on basics, definitions, and exceptions.  Recordkeeping! The IRS must have a thousand rules!  Would it surprise you that the answer is not really?  IRS has a “reasonableness” standard  If you are audited you are expected to be able to show your math on what you reported on your Form 990.   Why keep good records of your lobbying?  Charities must report their lobbying to the IRS every year. Exceeding lobbying limits leads to excise taxes and (eventually) jeopardizes tax-exempt status. Recordkeeping lets electing charities do more lobbying without fear. Recordkeeping helps a charity raise funds more effectively. Good recordkeeping is protection against false accusations. Recordkeeping is a good management tool.             What do you track?  Direct Costs  Travel  Printing costs  Anything with a receipt that is all or mostly for lobbying  Primary purpose is lobbying? Count it all. Less than half? Split proportionately.      Staff Time  Best option: Timesheets  Occasional lobbying: Lobbying “incident” report  One-shot lobbying: Memo to file      Overhead costs  Easiest with time sheets  Add up total hours worked and total hours spent on direct lobbying  Apply the percentage to all overhead (rent, utilities, internet access, support staff, etc.)  Repeat for grassroots lobbying      Junk drawer of final thoughts  Do not adopt a system just because it is used by another organization – use the one that is most reasonable for your organization.  Remember there are state and local reporting requirements too – make sure those are integrated into your system.  Timesheets have much more utility beyond tracking lobbying – consider that when making your decision on a system.    Resources Keeping Track: A Guide to Recordkeeping for Advocacy Charities  Being a Player: A Guide to the IRS Lobbying Regulations for Advocacy Charities  Sample Timesheets  Simpler Timesheet  Simplest Timesheet  Complex Timesheet  Simple Timesheet for Affiliated Organizations  Complex Timesheet for Affiliated Organizations  Timesheet with Lobbying Disclosure Tracking