The Definition Of A Non Profit Organization
Many of you have heard of a non profit organizations but do you really know what it is? The definition of a non profit organization is an organization that uses its surplus revenues to further achieve its purpose or mission, rather than distributing its surplus income to the organization's shareholders as a profit. This means that instead of the organization's profit going into their pocket it goes towards the benefit of the general public for the cause that the organization has dedicated itself to. An example of this would be if the St Jude's Children Hospital ( a nonprofit organization ) was to make a profit of 10,000 dollars the money would not go into the pockets organization's shareholders but would go into helping the children in need
of medical care. The difference between nonprofit and for-profit organizations is in the way that the profit is used. So, this means that yes non profit organizations do indeed make money.
But how do non profit organizations make a money? The money for salaries and other expenses may come from donations, membership dues, grants, or products and services sold by the organization. This makes up their income which is used to pay off the employees salaries and keep the organization running. Grants are a large part of how organizations make their money. This will be further elaborated on in the speech.
So now that we know a little bit about what nonprofit organizations and how they operate let's learn about the different types. Nonprofit organizations fall into five main categories:
Trade associations, organized to advance a group of people who have a profession in common,
Charitable organizations, which must generally demonstrate a benevolent component. This is a diverse category, including religious groups, museums, environmental and educational organizations, libraries, and the many helping groups referred to as "charities." They are also referred to as 501 (c)(3) organizations, because that is the number of the IRS Code under which they are described.
Social clubs, such as country clubs and fraternal organizations.
Governmental groups, including city, county, state, and federal agencies.
Political groups, generally organized to promote certain policies, issues, or candidates for political office.
of medical care. The difference between nonprofit and for-profit organizations is in the way that the profit is used. So, this means that yes non profit organizations do indeed make money.
But how do non profit organizations make a money? The money for salaries and other expenses may come from donations, membership dues, grants, or products and services sold by the organization. This makes up their income which is used to pay off the employees salaries and keep the organization running. Grants are a large part of how organizations make their money. This will be further elaborated on in the speech.
So now that we know a little bit about what nonprofit organizations and how they operate let's learn about the different types. Nonprofit organizations fall into five main categories:
Trade associations, organized to advance a group of people who have a profession in common,
Charitable organizations, which must generally demonstrate a benevolent component. This is a diverse category, including religious groups, museums, environmental and educational organizations, libraries, and the many helping groups referred to as "charities." They are also referred to as 501 (c)(3) organizations, because that is the number of the IRS Code under which they are described.
Social clubs, such as country clubs and fraternal organizations.
Governmental groups, including city, county, state, and federal agencies.
Political groups, generally organized to promote certain policies, issues, or candidates for political office.