| Definition Of A Non-Profit |
A not-for-profit is an organization whose primary objective is to support some issue or matter of private
interest or public concern for non-commercial purposes. Nonprofits may be involved in the arts, charities,
education, politics, religion, research, sports or some other endeavor that benefits the public in a non-commercial
way.
Although non-profits, by definition, do not seek to prosper by commercial means, a nonprofit organization may
accept, hold and disburse money and other items of value. It may also legally and ethically trade at a profit but
the extent to which it can generate income may be constrained, or the use of profits may be restricted. Nonprofits
therefore are typically funded by donations from the private or public sector, and often have tax-exempt status.
Tax-exempt status is granted to non-profit organizations by the Internal Revenue Service and if an organization
applies for tax-exempt status it usually does so through what is called a 501(c)(3) filing. There are a number
of tests that the IRS applies and any entity organized and operated exclusively for religious, charitable, scientific,
testing for public safety, literary, or educational purposes, or to foster national or international amateur sports
competition, or for the prevention of cruelty to children or animals will generally succeed in their application.
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