A not-for-profit corporation is a corporation formed under the Not-for-Profit Corporation Law. Not-for-profit corporations may not be formed for profit or financial gain. They can make money however, and the officers can take a salary as part of the corporation.
They come in two broad categories: Charitable Corporation / Non-Charitable Corporation. That status is set at the creation, so it’s important to understand the difference in tax status.
A Charitable Corporation is any corporation formed for Charitable Purposes. Charitable Purposes of a corporation means one or more of the following purposes: charitable, educational, religious, scientific, literary, cultural, or for the prevention of cruelty to children or animals. These corporations are granted a 501(c)(3) status by the IRS after applying, and once granted, can offer tax deductions to their donors.
A Non-Charitable Corporation means any corporation formed under the Not-for-Profit Corporation Law, other than a Charitable Corporation, including but not limited to one formed for any one or more of the following non-pecuniary purposes: civic, patriotic, political, social, fraternal, athletic, agricultural, horticultural, or animal husbandry, or for the purpose of operating a professional, commercial, industrial, trade or service association. Their status varies based on what the purpose is, but overall does not allow for tax deductions as they are not 501(c)(3)s.
Gold Law Firm has created numerous non profits and can assistance in guidance in setup, compliance, and ongoing governance issues.
See our List of Client Services