What is a 527 entity?

What is a 527 entity?

A 527 organization or 527 group is a type of U.S. tax-exempt organization organized under Section 527 of the U.S. Internal Revenue Code (26 U.S.C. § 527). A 527 group is created primarily to influence the selection, nomination, election, appointment or defeat of candidates to federal, state or local public office.

What is Section 527 of the IRS tax code?

IRC 527 imposes a tax on the “political organization taxable income” of political organizations – broadly speaking, income Page 2 from sources other than contributions, membership dues, and fundraising events.

Is a 527 a PAC?

The Section 527 Political Action Committee (527 PAC) in conjunction with Political Organization and Filing Disclosure (POFD) is an Internal Revenue Service (IRS) application controlled under the IRS TEGE Business Unit.

How do I file a 527 organization?

Form 8871, Political Organization Notice of 527 Status, must be filed both electronically and in writing, within 24 hours of the political organization’s establishment. Until it files the form, its income (including contributions) is subject to taxation and is reported on Form 1120-POL.

Can a 527 donate to a 501c3?

No, a section 501(c)(3) organization may not make a contribution to a political organization described in section 527 (such as a candidate committee, political party committee or political action committee (PAC)). Nor may such an organization establish and maintain a separate segregated fund under section 527.

What is the difference between a 527 political action committee and a 501 c )( 4 quizlet?

The main difference between a 527 Committee and a 501c(4) Committee is that… A 501c(4) is not legally required to disclose where it gets its money, while a 527 is legally required to do so.

Do political campaigns need an EIN?

A political organization must have its own employer identification number (EIN), even if it does not have any employees.

Do I need to file a form 8871?

If an organization in fact has annual gross receipts of $25,000 or more for any taxable year, it must file Form 8871 within 30 days of receiving $25,000 in a single taxable year to continue to be tax-exempt.