What this is: 501(c)(4) organizations often mistakenly believe they are exempt from charitable solicitation registration, particularly when fundraising nationwide. But like charities, they are usually required to register in their home state and when soliciting across state lines.
What this means: This article aims to explore some of the state-specific nuances of 501(c)(4) organizations and their registration and filing requirements.
501(c)(4) Registration Misconceptions
Social welfare organizations (or 501(c)(4)s) are not charitable organizations, so frequently they misunderstand their registration requirements pursuant to various state charitable solicitations acts. Frequently, they believe that they are exempt from charitable solicitation registration when fundraising nationwide. Sometimes, they erroneously think that registration is only required if they are soliciting for a charitable program, perhaps a program that is related to their purpose or mission. These are all misconceptions. Just like charities, most 501(c)(4) organizations are required to register to solicit, usually in their state of domicile, and when their solicitation activities cross state lines.
States That Do Not Require Filings
Like charities, there are some states where no filings are required for 501(c)(4) organizations:
| Delaware | Iowa | South Dakota | Wyoming |
| Idaho | Montana | Utah | |
| Indiana | Nebraska | Vermont |
Other State Registration Exceptions
Similarly, Arizona only requires veterans organizations to register, and the same is true for Texas, which also requires public safety and law enforcement organizations to register. Also, Louisiana only requires registration if professional solicitors are engaged to fundraise. In Missouri, unlike charities, where all 501(c)(3) organizations are exempt from registration (upon request), social welfare organizations (501(c)(4)s) are required to register to solicit. Likewise, Michigan offers an exemption from registration for 501(c)(4)s, but a one-time exemption application is required.
‘Charitable Organization’ Definition
In most state charitable solicitations acts, a “charitable organization” by definition includes organizations established for “social welfare” or “advocacy” purposes (see our chart of state definitions of “charitable organization”). This expanded state definition for a charitable organization results in the need for many 501(c)(4)s to register to solicit when fundraising nationwide.
501(c)(4)s Are Required to Register in up to 21 States
Fortunately, unlike charities that can be required to file charitable solicitation registrations in up to 41 states (but usually 36 states and Washington, DC), 501(c)(4) organizations are required to register in up to 21 states. They include:
| Arkansas | Kansas | North Carolina | Washington |
| Colorado | Kentucky | North Dakota | Washington, DC |
| Connecticut | Minnesota | Oregon | Wisconsin |
| Florida | Missouri | Pennsylvania | |
| Georgia | New Jersey | Rhode Island | |
| Hawaii | New Mexico | South Carolina |
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State Nuances
Louisiana and Nevada
Also, 501(c)(4)s organized for “civic” purposes are required to register in Louisiana and Nevada. Note, though, that an exemption is available in Louisiana, if professional fundraisers are not used to solicit in the state. Otherwise, organizations with a “civic” purpose that use the services of a professional fundraiser are required to register in Louisiana. An exemption filing/letter is not required; Louisiana allows the exemption to be self-declared.
Ohio
In Ohio, registration depends on language in the corporate purpose, so a careful review of that is required. Generally, 501(c)(4)s are not required to register in Ohio.
New York and Virginia
Additional research and consideration is needed in New York and Virginia. Some experts believe that registration is required in these states. However, there is no compelling, statutory reason to register in New York and Virginia. Also, New York offers a $25,000 monetary-threshold exemption (i.e. registration is not required if contributions from New York donors do not exceed $25,000). An exemption application is available for New York and though the filing is recommended, it is not required.
States Where Registration is Not Required by 501(c)(4)s
If funds are not solicited for a charitable program or purpose, then there are 13 states where registration is not required by 501(c)(4) organizations:
| Alabama | Maryland | Oklahoma |
| Alaska | Massachusetts | Tennessee |
| California | Michigan | West Virginia |
| Illinois | Mississippi | |
| Maine | New Hampshire |
Exemptions
A one-time exemption application is required in Alabama, Maryland, Michigan, Mississippi and West Virginia. In New Hampshire, if you believe your organization may not be subject to their registration and reporting requirements, then you may file a Request for Pre-Registration Review. Also, though optional, an exemption letter can be submitted in California and Oklahoma. Finally, an exemption can be self-declared in Alaska, Illinois, Maine, Massachusetts and Tennessee.
IRS Forms 8976 and 1024-A
A 501(c)(4) social welfare organization may need to register with certain states before soliciting donations. While such an organization is required to file IRS Form 8976, Notice of Intent to Operate Under Section 501(c)(4), the filing of Form 1024-A, Application for Recognition of Exemption Under Section 501(c)(4) of the Internal Revenue Code, is optional. An organization that files Form 1024-A will receive an IRS Determination Letter upon approval, but a letter is not issued to organizations that choose not to apply. Since many states require registrants to provide a copy of the IRS Determination Letter, an organization that elects not to file a Form 1024-A may be unable to register.
Other Reads You Might Enjoy
What is one common misconception about charitable solicitation registration?
Charitable Solicitation Registration is Required in All States for Online Fundraising. False. A widespread myth suggests that any charity soliciting online must register in every state. The misconception here is that since online fundraising can potentially reach donors in every state, then charitable solicitation registration is required in all states. This is not accurate. Want to learn more? Read our article, Charitable Solicitation Registration: 3 Common Misconceptions.
What is an example of a common type of nonprofit risk?
Fraud. Although there are many types of fraud, the 2 that most often affect nonprofits are financial fraud (both intentional and unintentional) and fraud by impersonation. The latter occurs when a scammer sets up a fake donation page using your organization’s branding and employer identification number (EIN) to collect donations under the guise of charity while pocketing the money for themselves. To read more on this topic, refer to our article, Understanding Nonprofit Risk Management: 3 Things to Know.
What is the General Data Protection Regulation (GDPR)?
The GDPR is a European Union regulation impacting nonprofits that collect and process personal information from individuals residing in the EU. It grants individuals greater control over their personal information by requiring organizations to obtain clear consent for data collection, provide transparent data processing practices and allow individuals to access, rectify or erase their data upon request. Refer to our article, Nonprofit CRMs: How to Navigate Data Privacy and Compliance, for more information.
This article is provided for informational purposes only and should not be considered, or relied upon, as legal advice.
