A business league is an association of persons having some common business interest, the purpose of which is to promote such common interest and not to engage in a regular business of a kind ordinarily carried on for profit. Trade associations and professional associations are business leagues. To be an exempt, a business league's activities must be devoted to improving business conditions of one or more lines of business as distinguished from performing particular services for individual persons. No part of a business league's net earnings may inure to the benefit of any private shareholder or individual and it may not be organized for profit to engage in an activity ordinarily carried on for profit (even if the business is operated on a cooperative basis or produces only enough income to be self-sustaining). The term "line of business" generally refers either to an entire industry or to all components of an industry within a geographic area. It does not include a group composed of businesses that market a particular brand within an industry.

For more information, see IRC 501(c)(6) Organizations.

Seeking legislation germane to the common business interest is a permissible means of attaining a business league's exempt purposes. Thus, an Internal Revenue Code ("IRC") section 501(c)(6) business league may further its exempt purposes by lobbying as its sole activity without jeopardizing its exempt status. However, a section 501(c)(6) organization that engages in lobbying may be required either to notify its members about the percentage of dues that are used for lobbying activities or to pay a proxy tax. For more information, download Lobbying Issues

Participating directly or indirectly, or intervening, in political campaigns on behalf of or in opposition to any candidate for public office does not further exempt purposes under section 501(c)(6). However, a IRC Section 501(c)(6) business league may engage in some political activities, so long as that is not its primary activity. However, any expenditures it makes for political activities may be subject to tax under IRC Section 527(f). For further information regarding political and lobbying activities of IRC Section 501(c) organizations, see Election Year Issues, Political Campaign and Lobbying Activities of IRC 501(c)(4),
(c)(5), and (c)(6) Organizations, and Revenue Ruling 2004-6.