The Daily Beast: Palmer Luckey: The Facebook Near-Billionaire Secretly Funding Trump’s Meme Machine
According to Paul Ryan, deputy executive director of the The Campaign Legal Center, Nimble America can still exist as a 501(c)(4) so long as it does other things besides supporting Trump.
“Federal tax law prohibits 501(c)(3) organizations from spending any money to intervene in (i.e., influence) a candidate election,” Ryan said in an email to The Daily Beast. “By contrast, federal tax law permits 501(c)(4) organizations to spend money advocating the election or defeat of candidates, so long as such activity isn’t the 501(c)(4) organization’s ‘primary’ activity. And for any group that DOES have candidate advocacy as its primary activity, the appropriate tax exempt status is under Section 527 of the tax code.”
So Nimble America is allowed to do what it’s doing up to a certain point.
“The group knows that it can do some candidate election work, but that such work can’t be its primary activity—i.e., it has to spend more than half of its budget on non-candidate-election work,” Ryan told The Daily Beast when provided documentation about the organization.