What is a Non Profit Corporation?

 
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Posted On : 22nd Jan 2010

A non-profit organization is an organization that does not distribute its surplus funds to owners or shareholders, but instead uses them to help pursue its goals. Examples of nonprofit organizations include charities (i.e. charitable organizations), trade unions, and public arts organizations. Most governments and government agencies meet this definition, but in most countries they are considered a separate type of organization and not counted as nonprofit.

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Ann Klaus White

13th Mar 2015

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We are Lake Washington Condominium...a condo complex in Dayton,Ohio that is/was registered as a non-profit. It is possible with changing boards etc. that our status has expired. Can you tell me how to check on status...and if that is true, how and where to renew our status? Thank you, Ann

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Reply from: infotaxsquare.com | 2015-03-13

Ann Klaus White:

Thank you so much to choose InfoTaxSquare.com for your business needs. Yes, you can and advice you to please contact to the secretary of state office of your state.

You can also use the following links to see, what our customers say about our professionalism and customer service.

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Mr. Robert Jordan

16th Jul 2013

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Good day My question is that I would like to establish a corporation which consists a daycare, training area for male and female of inner city area,etc which at first I will be funding, then with admission fees to pay for transportation, materials, supplies,etc, can such be considered for non-profit status ?

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Reply from: infotaxsquare.com | 2013-07-16



Register A Daycare As A Non-Profit Corporation?


"However you serve the society, it is rated a good action or motion".

The purpose to establish a nonprofit is serving not earning. As long as you can justify to the state and the Internal Revenue Service in the nonprofit charter that it is being formed to help the community, not making a profit out of it, yes any type of organization can secure an exempt status to receive funds from the donors to run a daycare center  a nonprofit entity.

Comparison to start a daycare rather a nonprofit than profit:

It is like a business plan, that's how you are going to operate a business. In business, your motive is a profit, whereas in nonprofit your goal is to support the society, but in either case you cannot run the show without a cash flow.

In nonprofit you have to convince donors to support, whereas in profit you have to convince investors to invest. Both options require tough exercise.

Generally, return on investment is more motivated or attractive whereas no return on investment in the nonprofit organization.


A business entity can start instantly, whereas a non profit entity takes months to start. The Internal Revenue Service acquires sufficient time to secure an exempt status, and you may face a frustrating, if the Internal Revenue Service declines your request to establish a day care center as a nonprofit, if you could not satisfy with the Internal Revenue Service.

Where to apply?

It is first registered with the secretary of state and later with the Internal Revenue Service to get exempt status for the daycare center.

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Cindy

20th Feb 2013

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Our booster club wants to be non-profit. We do not get a large amount of money just donatiions but it there is excess money we give scholarships to deserving students. do we need to file as a non-profit?

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Reply from: infotaxsquare.com | 2013-02-20


How To Organize Nonprofit Organization For  A Booster Club?


Basic Features of a Booster Club:

  • A booster club is normally created to support small events for the schools such as sports. 
  • Regardless, collecting a small or large amount in a donation to serve the society , a nonprofit entity has to be registered in the state where you are physically located to serve the community;
  • Otherwise, a booster club will be treated as a profit entity and the donors cannot include their donations on the income tax returns for a tax deduction or credit.
  • It runs under the Internal Revenue Service Rules and Regulation.

Requirement to start a nonprofit for a Booster Club:

  1. Prepare a nonprofit charter to file with the secretary of state of your state which contains the intention of the organization.
  2. The purpose of the booster club must be "Served" not "Earned" to list it as a nonprofit entity. The serving entities form a nonprofit corporation, whereas the earning entities register a profit corporation.
  3. Include, all officers and directors' names in the charter.
  4. Mention principal place of business and the obligations of each director and officers in nonprofit organization for your booster club.
  5. A booster club is classified as a non religious organization.
  6. Get an EIN for your booster club which helps you to open a bank account and filing yearly non profit returns with the state and Internal Revenue Service.

Get Federal Exemption For A Booster Club:

501 (c) (3) application is filed with the Internal Revenue Service to classify a booster club as a nonprofit entity to collect contribution to run the organization.

Where to search to find out if the booster club is registered with the Internal Revenue Service as a Non Profit organization before making a contribution?

It is searched on the Internal Revenue Service website.

Can A Nonprofit register as an LLC?

In most states, a nonprofit organization has separate rules and regulations and cannot be registered as an LLC or a regular domestic corporation.