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A 527 group is a non-profit organization that engages in political actions, such as clarifying issues surrounding a candidate’s candidacy or lobbying for specific laws. They can be political action committees subject to stricter rules. They are independent of the candidate running for office and can influence voter opinion, but the politician has no control over their actions. There are fine lines as to what a 527 group can and cannot do, and they have been fined for attacking candidates rather than focusing on issues. The US Congress has considered changing laws governing them, but none have been passed yet.
Because many nonprofit organizations labeled 501c3 by the U.S. Tax Code have severe restrictions on engaging in any political activity, the Internal Revenue Service (IRS) offered a different designation for nonprofit groups that wanted to specifically engage in political actions. A 527 group is the IRS designation for a non-profit group that primarily helps clarify issues surrounding an individual’s candidacy or that may lobby for specific laws or reforms. 527s can also be political action committees (PACs), although these are subject to stricter rules in terms of donations.
These organizations are often a way around some of the campaign finance reforms that now limit the donations a politician can take to run. Group 527 that is not a PAC is independent of the candidate running for office. In recent history, some of these organizations have included Swift Boat Veterans for Truth and MoveOn.
While the candidate running for office may have nothing to do with fundraising for a 527 group, such an organization can be especially effective in influencing voter opinion. However, because it is independent of the politician, he or she actually has no control over what the 527 group does. This can consequently lead to some pretty dirty political practices. In fact, Swift Boat Veterans for Truth has been considered so effective in disseminating possibly dubious information about Senator John Kerry’s interpretation of the Vietnam War, that “swiftboating” has become a term used to describe dirty and negative announcements that may not be of the all truthful and can destroy a politician’s candidacy.
There are some very fine lines as to what a 527 groupset can and cannot do. For example, both MoveOn and Swift Boat Veterans were fined by the Federal Election Committee (FEC) for actions committed during the 2004 presidential campaign. The FEC concluded that both organizations had actually attacked candidates rather than problems, thereby affecting the vote for specific candidates. Strictly speaking, a 527 must focus on issues and not attack or defend a candidate. He should not support a candidate, and if he is found to have supported the election or non-election of a candidate, he is in violation of Rule 527.
As mentioned, the line is very thin, especially in heated political disputes between candidates. A 527 group dedicated to specific issues often supports applications from like-minded individuals. This type of organization may go as far as it can, within limits, to suggest that one candidate is better than another or that one candidate is inferior to another. Indeed, the practice of the 527s born around certain nominations has led the US Congress to consider changing the laws governing them. So far, no law has been passed banning the 527s or restructuring them.
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