We’ve all heard of non profit organizations, and likely have a general understanding of what the term means, but do feel you have a really good understanding of what a non profit actually is?
Essentially a non profit (sometimes called “not-for-profit”) organization is an organization which enjoys tax exempt status as a result of being organized to serve the public interest. Generally the non-profit’s primary purpose is to support an issue of public concern for non-commercial purposes. These usually fall into broad classifications of the arts, charities, religion, research, education or even politics.
As the name implies, non-profits are not trying to turn a profit on their activities. However, like all organizations they do have to generate revenues to fund their operations. The primary sources of funds for non profits are funding from government and/or private donors, with the inducement for private donors being that donations to the non profit are likely tax deductible.
