Historical Note: The Treasury Regulations’ Definition of “Educational”

Normally, the first place to turn when interpreting section 501(c)(3) is the Treasury Regulations, and the fact that the IRS will not ordinarily do so when attempting to identify what is "educational" under section 501(c)(3) might appear confusing. In fact, the Regulations do contain a definition of "educational":

(3) Educational defined--(i) In general. The term educational, as used in section 501(c)(3), relates to:

(a) The instruction or training of the individual for the purpose of improving or developing his capabilities; or

(b) The instruction of the public on subjects useful to the individual and beneficial to the community.

An organization may be educational even though it advocates a particular position or viewpoint so long as it presents a sufficiently full and fair exposition of the pertinent facts as to permit an individual or the public to form an independent opinion or conclusion. On the other hand, an organization is not educational if its principal function is the mere presentation of unsupported opinion. [FN1]

The Regulations also include a non-exclusive list of examples of "educational" activities, including: (i) operation of traditional schools, with a regular curriculum, faculty and enrolled body of students; (ii) presentation of public discussion groups, forums, panels, lectures, or similar programs, including by radio or television; (iii) offering remote learning via correspondence or utilization of TV or radio; or (iv) operation of cultural centers such as museums, zoos, planetariums, and symphony orchestras. [FN2]

The Treasury Regulations thus attempted to accomplish two goals: to define "educational" activity generally, and then specifically to distinguish "advocacy" that does not fall within the "educational" category. They were, for the most part, not successful. Although the examples included are somewhat useful, the general definition of "educational" set forth in the Regulations is so vague as to be nearly useless.

In fact, in the 1980 case of Big Mama Rag, Inc. v. United States, the U.S. Court of Appeals for the District of Columbia Circuit ruled that that the definition was constitutionally defective. Because the definition allowed the IRS wide subjective discretion as to which organizations would be deemed "educational," the court held that it violated the First Amendment to the U.S. Constitution. In particular, the court found that the Regulations' reference to a "full and fair exposition of pertinent facts" enabled the IRS to discriminate unlawfully against viewpoints of which it disapproved. [FN3]

The Big Mama Rag decision was a turning point in the IRS's consideration of publishing organizations, requiring the IRS to rethink its standards for defining "educational" activity.


1 Treas. Reg. § 1.501(c)(3)-1(d)(3)(i) (as amended in 2008).
2 Treas. Reg. § 1.501(c)(3)-1(d)(3)(ii) (as amended in 2008).
3 631 F.2d 1030, 1035-39 (D.C. Cir. 1980).



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