What is a non-profit organization?
There are many kinds of non-profits, but for most people, non-profit means a “charitable” or 501(c)3 organization.
What separates a charitable organization from other types of tax-exempt organizations is its purpose: it must benefit the broad public interest, not just the interests of its members. Congress and state legislatures have long recognized this special service by making these organizations tax-exempt, which enables them to dedicate their funds to fulfilling their missions. To encourage the American people to make contributions, federal and state governments have allowed taxpayers to deduct charitable contributions when calculating their income taxes.
Charitable organizations receive their tax-exempt status under section 501(c)(3) of the Internal Revenue Code. To obtain this designation an organization must outline to the Internal Revenue Service the details its charitable purposes, its sources of funding, the members of its board of directors, its bylaws, and other information.
The IRS recognizes Lake Superior Hospice as a charitable 501(c)3 organization.
What is the difference between a non-profit and for-profit?
The difference between non-profit and for-profit organizations is for profit organizations are commonly privately owned and operated, where as in a non-profit the Board of Directors controls the organization. In non-profit organizations none of the surplus in funds can benefit an individual or stakeholder.
Non-profit organizations rely heavily on fundraising and donations for the funds needed to run the day-to-day operations. Without these opportunities many non-profit organizations would not be able to provide service. Non-profits are people coming together to form an organization to solve problems and enrich their communities. Non-profit organizations play a major role in the social and economic well being of our communities. They allow people to donate time, resources and expertise for a greater good.