Christian nonprofit required to pay taxes for lobbying

The Hawaii Family Forum, a Christian nonprofit that opposed civil unions, spent so much money politicking last year that Internal Revenue Service required it to pay the $20,741 in taxes for its "excessive lobbying," according to its latest tax return.

The charity reported spending $125,695 on lobbying last year; in 2008 it spent nothing on lobbying. The change comes after several complaints were filed with the IRS about its extensive political activities.

"This tax form just confirms what we had suspected, and that is that they engaged in excessive lobbying, that they have no charitable programs, that they are 100 percent a lobbying organization," Holly Huber told the Honolulu Star-Advertiser. Huber filed a complaint with the IRS in June on behalf of Hawaii Citizens for the Separation of State and Church. "They should not be a tax-exempt nonprofit charitable organization. They are a political action group."

The group's 2009 federal tax return was due May 17, but the organization requested an extension. The return was filed on Sept. 14, and a copy was sent by certified mail yesterday to Huber in connection with her IRS complaint.

As a charitable 501(c)(3) nonprofit recognized by the IRS, Hawaii Family Forum may receive tax-deductible donations and is normally exempt from paying income taxes. Such charities, however, may not endorse political candidates and they must limit their lobbying. Charities the size of the forum may use no more than 20 percent of their overall expenditures for lobbying. If a charity exceeds lobbying limits repeatedly, the IRS can revoke its tax-exempt status, which enables charities to accept tax-deductible contributions and frees them from paying income tax.

Hawaii Family Forum’s 2009 tax return shows that more than half of its spending went to lobbying: $68,139 in lobbying to influence public opinion and $57,556 in direct lobbying, for a total of $125,695. The group reported spending $87,955 for other purposes.

Hugh Jones, supervising deputy attorney general for the state, told the newspaper it is rare for a charitable organization to face taxes for lobbying, because charities that choose to lobby usually elect to file a special federal form and stay within prescribed limits. "Because of the safe harbor provisions of the federal tax law, incurring a tax on lobbying expenses is an unusual event for charities," Jones said yesterday. "I personally am not aware of another case in Hawaii, but that doesn't mean it hasn't happened."

The lobbying expenditures Hawaii Family Forum reported to the IRS for 2009 exceed what it had reported earlier to the Hawaii State Ethics Commission for that year. It told the commission it had spent $74,000 on lobbying in 2009, mostly for media advertising.

Francis Oda , the president of Hawaii Family Forum says the Christian nonprofit will now focus more on charitable work and less on lobbying in an effort to stay within federal guidelines for tax-exempt charities.

"Hawaii Family Forum was not set up to lobby,” he said. “Before this whole same-sex marriage thing, our primary focus was on the adoption of children out of the Family Court system. We do get involved in issues, but our primary focus is to support families.”