Tax-Exempt Organizations

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Types of Federal tax-exempt organizations: comparison table
Primary purpose	Charitable, educations, scientific, literary (and certain others)	Social welfare/ advocacy	Trade associations, business leagues and the like	Social clubs	Influencing elections or appointment to public office
Governing section of Internal Revenue Code	501(c)(3)	501(c)(4)	501(c)(6)	501(c)(7)	527
Contributions deductible?	Yes; different limitations for public charities and private foundations	No (unless deductible as a business expense); contributions may be subject to gift tax	Generally yes, as a business expense; may be limited if organization engages in legislative or election activities	No	No
Substantially related exempt function income exempt?	Yes	Yes	Yes	Exemption generally limited to revenue received from members and their guests	Yes
Investment income exempt?	Yes	Yes	Yes	No	No
Tax on Unrelated Business Income?	Yes	Yes	Yes	Yes	Yes
Legislative advocacy ("lobbying") permitted?	Public charities: yes, but limited Private foundations: taxable	Yes	Yes, but triggers partial disallowance of deduction for dues, or tax on organization	Yes, if within the organization's exempt purpose	Limited; may be taxable
Election activities/ communications permitted?	No	Limited; may be taxable	Limited; triggers partial disallowance of deduction for dues, or tax on organization	Possibly, if within the organization's exempt purpose	Yes
Non-legislative advocacy permitted?	Yes	Yes	Yes	Yes, if within the organization's exempt purposes	Limited

The table above addresses some of the most common types of tax-exempt organizations. There are a number of other types, each serving particular purposes. However, the only categories of tax-exempt organizations eligible to receive tax-deductible contributions are those qualified under section 501(c)(3) and certain veteran’s, fraternal and cemetery organizations.

Types of Federal tax-exempt organizations: comparison table

Primary purpose

Charitable, educations, scientific, literary (and certain others)

Social welfare/ advocacy

Trade associations, business leagues and the like

Social clubs

Influencing elections or appointment to public office