Center For Financial Independence
There are huge markets where people have needs — for food, shelter, education and more — but can’t afford to pay money out of their own pockets to have their needs met.
In the United States, the government created the 501(c)3 nonprofit corporation to help address this situation. Technically speaking, a 501(c)3 is a tax-exempt legal structure that can receive charitable donations from individuals, businesses, government agencies, and philanthropic foundations. Examples of well-known not-for-profits include: the Boys and Girls Clubs, the YMCA and the Sierra Club. People who donate money to these charitable organizations benefit by deducting the contributions from their taxable income.
In the United States, over one million organizations qualified for 501(c)3 status in 2009 compared to 600,000 in 1993. Charitable donations have declined: in 2008, $315.08 billion were invested in the not-for-profit sector, compared to $303.75 billion in 2009. Competition for resources has increased, making it more difficult for nonprofits to grow or even exist.
Like any business, a nonprofit must generate revenue to cover its expenses. It needs to identify a target market and figure out how it will deliver its products and services to that market. Some key differences and considerations exist, however, and you should be aware of them before you choose this legal structure:
Here is a format for a nonprofit strategic and tactical plan you should follow: