non-profit organization

Definition

An incorporated organization which exists for educational or charitable reasons, and from which its shareholders or trustees do not benefit financially.

Any money earned by a non-profit organization must be retained by the organization, and used for its own expenses, operations, and programs. Many non-profit organizations also seek tax exempt status, and may also be exempt from local taxes including sales taxes or property taxes. Well-known non-profit organizations include Habitat for Humanity, American Red Cross, and United Way.


Also called not-for-profit organization.

Use this term in a sentence

National Wildlife Federation is a non-profit organization that works to preserve endangered wildlife while also educating others on the importance of nature.

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My partner and I finally decided that we wanted to form a non-profit organization after discussing what our goals for the future were.

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In order to reverse the contraction of the print news business in the late 2000s, Senator Ben Cardin of Maryland introduced a bill that would ease the process for a newspaper to become a non-profit organization, which would greatly reduce or eliminate the tax liability for the newspaper.

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NAIC 501-(C)(3) bond