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If you are thinking of launching a non-profit organization, you should know that it is a type of organization serving to benefit the public, specific groups of individuals or the membership of the non-profit without any commercial or monetary profit purposes. NPOs encompass such areas as religion, health care, charities, politics, social issues, etc.
The major distinction of non-profits is legal and ethical restrictions on the distribution of profits to owners and shareholders. NPOs are not supposed to make profit though it does not necessarily mean that they do not do this. In fact, most NPOs make profit selling goods or services. They can pay salaries to the employees, just cannot distribute any profits for the benefit of directors or members
Being a recognized non-profit organization means gaining private and public grants, low-cost postage rates and exemption from income, sales and property taxes. According to Section 501(c) (3) of the IRS Charitable, religious, scientific, literary and educational organizations are exempted from payment of federal income taxes.
To successfully operate a Non-Profit Organization you are to:
- Do not mix up personal affairs with the affairs of NPO (a separate bank account, separate records, separate accounting books)
- Hold all corporate meetings
- File all non-profit tax forms and licenses
- Obtain non-profit’s Employer Identification Number and licenses
For more information visit:
Steps to Incorporating your Nonprofit 501(c)(3)
Useful Books
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