Non-Profit Organizations
A non-profit organization is a legally constituted group with the primary function of supporting or actively engaging in activities of private or public interest without any commercial profit motive.
Non-profit organizations generally are active in areas such as the environment, animal protection, humanitarian aid, social issues, charities, the arts, religion, health care, politics, sports and others.
What makes non-profit organizations different?
Non-profit organizations are distinguished from commercial organizations by ethical and legal restrictions regarding the distribution of profits. Non-profit organizations have also been referred to as not-for-profit groups. They do not operate to generate a profit, but they are permitted to retain and disburse monies and other things of value and may also legally and ethically trade for a profit. The extent to which a non-profit group may generate income may be constrained and the use of any profits may be restricted. Therefore, non-profit organizations are normally funded by donations and often have tax-exempt status. Moreover, many donations may be tax deductible. Many non-profits are operated by either volunteers or paid employees. Some high-paid executive positions within a non-profit organization have been subject to scrutiny and come under question because the salaries paid were so high. However, another distinction is that they have participants or beneficiaries rather than customers. Finally, many non-profit organizations take in considerable monies but keep it distributed internally as salaries, benefits and expansion capital to retain their status.
How are non-profit organizations formed?
The formation of non-profit groups varies with the country in which they are legally registered. In the United States, they are normally formed by incorporating in the state where they will reside and plan to do business. When they are incorporated, non-profit organizations are empowered to enter into business arrangements, form contracts and own property in the same way commercial organizations can. They may be trusts or associations of members who elect a Board of Directors, a Board of Governors or a Board of Trustees. They may also have a delegate structure to permit the representation of groups or corporations as members. In addition, they may also be a non-membership organization and the Board may elect its own successors. Finally, non-profits may apply for tax-exempt status, which exempts them from income and other taxes to permit financial donors to re-claim any income tax paid on their donations.
Internet websites are a big boon to non-profit organizations
Today, non-profit organizations use the Internet effectively to solicit donations and locate volunteer workers. They have also been utilizing various websites designed for outsource buyers and freelance providers to locate people who can provide them with needed services on a project basis. This is extremely effective for the non-profit and also provides a meaningful opportunity for freelancers and independent contracting groups to work for an organization that they feel provides an important public service.
In the United States, non-profit organizations have domain names ending in .org , .us or .edu to differentiate themselves from commercial organizations that exist to make a profit and generally use .com space.
