Nonprofit corporation: Difference between revisions
imported>Roger A. Lohmann No edit summary |
imported>Pat Palmer (adding a paragraph that was formerly on the Definition, but belongs here instead) |
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Most nonprofit corporations differ from ordinary business corporations ([[C-corporation]]s and [[S-corporation]]s) in important ways. Most notably, nonprofit corporations as a group are characterized by various forms of [[nondistribution constraint]]s that prohibit them from distributing "profits" (or operating surpluses in any form) to owners or shareholders. | Most nonprofit corporations differ from ordinary business corporations ([[C-corporation]]s and [[S-corporation]]s) in important ways. Most notably, nonprofit corporations as a group are characterized by various forms of [[nondistribution constraint]]s that prohibit them from distributing "profits" (or operating surpluses in any form) to owners or shareholders. | ||
Under U.S. law, corporations are "legal personalities". The largest category of nonprofit corporation in the U.S. are exempt from federal (and state) taxation, donations to which may be tax deductible under Section [[501(c)(3)]] of the IRS Code if they are nonpolitical, or [[501(c)(4)]] if they engage in political activity | |||
In the U.S. legal system generally, nonprofit corporations are defined, and to a limited degree, regulated by state laws, which stipulate such requirements as [[articles of incorporation]], [[by-laws]] and the wording or nature of non distribution constraints. | In the U.S. legal system generally, nonprofit corporations are defined, and to a limited degree, regulated by state laws, which stipulate such requirements as [[articles of incorporation]], [[by-laws]] and the wording or nature of non distribution constraints. | ||
Revision as of 18:18, 25 September 2020
A nonprofit corporation is a legal and economic entity in the United States established under state law to govern, regulate and protect the assets of a range of charitable, educational, scientific, religious and other, similar activities and organizations and associations. Traditionally, nonprofit corporations are deemed legal individuals or "legal personalities" in their own right, separate from their founders and controllers and able to own property, enter into contracts, and incur debts of their own accord.
Most nonprofit corporations differ from ordinary business corporations (C-corporations and S-corporations) in important ways. Most notably, nonprofit corporations as a group are characterized by various forms of nondistribution constraints that prohibit them from distributing "profits" (or operating surpluses in any form) to owners or shareholders.
Under U.S. law, corporations are "legal personalities". The largest category of nonprofit corporation in the U.S. are exempt from federal (and state) taxation, donations to which may be tax deductible under Section 501(c)(3) of the IRS Code if they are nonpolitical, or 501(c)(4) if they engage in political activity
In the U.S. legal system generally, nonprofit corporations are defined, and to a limited degree, regulated by state laws, which stipulate such requirements as articles of incorporation, by-laws and the wording or nature of non distribution constraints.