A not-for-profit or non-for-profit organization (NFPO) is a legal entity that does not distribute surplus funds to its members and is formed to fulfill specific objectives.[1] An NFPO does not earn profit for its owners, as any revenue generated by its activities must be put back into the organization.[2]
While not-for-profit organizations and non-profit organizations are distinct legal entities, the terms are sometimes used interchangeably.[3] An NFPO must be differentiated from a non-profit organization (NPO) as it may not be formed explicitly for the public good as an NPO must be, and NFPOs are considered "recreational organizations", meaning that they do not operate with the goal of generating revenue as opposed to NPOs.[1]
Functionsedit
An NFPO does not have the same obligation as an NPO to serve the public good, and as such it may be used to apply for tax-exempt status as an organization that serves its members and does not have the goal of generating profit.[4] An example of this is a sports club, which exists for the enjoyment of its members and thus would function well as an NFPO, with revenue being re-invested into improving the organization.[1]
These organizations typically file for tax exemption in the United States under section 501(c)(7) of the Internal Revenue Code as social clubs.[5] Common ventures for which NFPOs are established include:
profit, organization, confused, with, nonprofit, organization, governmental, organization, charitable, organization, profit, profit, organization, nfpo, legal, entity, that, does, distribute, surplus, funds, members, formed, fulfill, specific, objectives, nfpo. Not to be confused with Nonprofit organization Non governmental organization or Charitable organization A not for profit or non for profit organization NFPO is a legal entity that does not distribute surplus funds to its members and is formed to fulfill specific objectives 1 An NFPO does not earn profit for its owners as any revenue generated by its activities must be put back into the organization 2 While not for profit organizations and non profit organizations are distinct legal entities the terms are sometimes used interchangeably 3 An NFPO must be differentiated from a non profit organization NPO as it may not be formed explicitly for the public good as an NPO must be and NFPOs are considered recreational organizations meaning that they do not operate with the goal of generating revenue as opposed to NPOs 1 Functions editAn NFPO does not have the same obligation as an NPO to serve the public good and as such it may be used to apply for tax exempt status as an organization that serves its members and does not have the goal of generating profit 4 An example of this is a sports club which exists for the enjoyment of its members and thus would function well as an NFPO with revenue being re invested into improving the organization 1 These organizations typically file for tax exemption in the United States under section 501 c 7 of the Internal Revenue Code as social clubs 5 Common ventures for which NFPOs are established include Charities Sports clubs Foundations Private schools Universities Museums Churches Social welfare organizationsSee also edit501 c organization Community organization Fundraising Nonprofit organization Mutual organization Non commercial activity Non governmental organization Nonprofit organization laws by jurisdiction Non profit organizations and access to public information Non profit technology Public benefit nonprofit corporation Supporting organization charity United States non profit laws Voluntary sectorReferences edit a b c Heaslip Emily 30 March 2020 Nonprofit Not for Profit amp For Profit Organizations Explained uschamber com Retrieved 14 February 2023 Associates Ashcroft amp 24 September 2015 Differences Between Nonprofit and Not For Profit Ashcroft amp Associates Retrieved 14 February 2023 Davis Kylie Nonprofit vs not for profit How to tell them apart Givebutter Retrieved 14 February 2023 Lake Rebecca 8 February 2023 Non Profit vs Not for Profit What s the Difference smartasset Retrieved 14 February 2023 Social Clubs Internal Revenue Service www irs gov Retrieved 14 February 2023 Retrieved from https en wikipedia org w index php title Not for profit organization amp oldid 1176869042, wikipedia, wiki, book, books, library,
