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The Curious Bag
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The Internal Revenue Code lists 28 types of organizations that qualify for not-for-profit status. Examples of not-for-profit organizations include charities, arts organizations, and educational organizations. Nonprofit organizations must reinvest any money earned over the cost of operating back into the company.
Mission Statement
In order to earn nonprofit status, the company must have a written mission statement. The mission needs to state the organization's philosophy or goal, who will benefit from its existence, and the company's objectives.
Board of Directors
Not-for-profit organizations need to have a board of directors, a group of elected volunteers and occasionally staff members from the organization. The role of the board is to support the company and to act in the best interests of the organization.
Tax Exempt
Not-for-profit organizations are exempt from paying federal taxes. They may also be exempted from state and sales taxes.
501(c)(3)
A 501(c)(3) not-for-profit organization is an organization with a charitable, literary, scientific, or educational purpose.
Other Nonprofits
Other organizations that may qualify for not-for-profit status include civic leagues (501(c)(4)), fraternal societies (501(c)(10)) and credit unions (501(c)(14).
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