Lobbying Series Part 5 – Recordkeeping


Quyen Tu, Tim Mooney, Natalie Roetzel Ossenfort


Our attorneys for this episode:

Quyen Tu Tim Mooney Natalie Ossenfort


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. 

Quick Reminder

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.