Non-profit Law

Guide to Charitable Organization Law

Non-profit Organization is used as a broad-based term that encompasses all organizations that are known variously as charities, nonprofits, non-governmental organizations (NGOs), private voluntary organizations (PVOs), civil society organizations (CSOs), etc. Not for Profit Organizations are regulated by local, state and federal laws. The purpose of a non-profit corporation or association is to conduct business for the benefit of the general public without shareholders and without a profit motive. Nonprofit corporations are created according to state law. Like for-profit corporations, nonprofit corporations must file a statement of corporate purpose with the Secretary of State and pay a fee, create articles of incorporation, hold regular meetings, and satisfy other obligations to achieve and sustain corporate status.

Nonprofit corporations are different than profit-focused corporations in several ways. The most simple difference is that nonprofit corporations cannot operate for profit. Meaning, they cannot allocate corporate income to shareholders. The funds acquired by nonprofit corporations must stay within the corporate accounts to pay for reasonable salaries, expenses, and the activities of the corporation. If the income of a corporation inures to the personal benefit of any individual, the corporation is said to be profit driven. Salaries are not considered personal benefits because they are essential for the operation of the corporation. An unwarranted salary, however, may cause a corporation to lose its nonprofit status.

Nonprofit corporations are exempt from income taxes if they conduct business solely for the benefit of the general public. State laws on corporations vary from state to state, but generally states give tax breaks and exemptions to nonprofit corporations that are structured and operated exclusively for either a religious, charitable, scientific, public safety, literary, or educational purpose. Nonprofit organizations may charge money for their services, and donations to tax-exempt nonprofit organizations are tax deductible. The Internal Revenue Service must approve the tax-exempt status of all nonprofit organizations except churches.

An immense number of organizations qualify for nonprofit status under the various definitions. Nonprofit organizations include churches, soup kitchens, charities, political associations, business leagues, fraternities, sororities, sports leagues, Colleges and Universities, hospitals, museums, television stations, symphonies, and public interest law firms.

For information about Nonprofit organizations, please visit the resources found below on this page. Additionally, for legal assistance related to nonprofit organizations, check our Law Firms page for a list of attorneys in your area.


Charitable Organizations Law - US

  • Audits of States, Local Governments, and Non-Profit Organizations

    This Circular is issued pursuant to the Single Audit Act of 1984, P.L. 98-502, and the Single Audit Act Amendments of 1996, P.L. 104-156. It sets forth standards for obtaining consistency and uniformity among Federal agencies for the audit of States, local governments, and non-profit organizations expending Federal awards.

  • Charitable Organizations Law - Definition

    A charitable organization is a type of non-profit organization (NPO). The term is relatively general and can technically refer to a public charity (also called "charitable foundation," "public foundation" or simply "foundation") or a private foundation. It differs from other types of NPOs in that its focus is centered around goals of a general philanthropic nature (e.g. charitable, educational, religious, or other activities serving the public interest or common good).

  • FTC - Avoiding Charity Fraud

    A flyer in the mail, a phone call, a personalized email — everyone receives requests for donations in one form or another. Many legitimate charities use telemarketing, direct mail, email and online ads to ask for contributions. Unfortunately, scam artists also use these techniques to pocket your money. If someone asks for a donation, take your time and familiarize yourself with the charity.

  • IRS - Tax Information for Charities and Other Non-Profits

    If you are interested in starting a nonprofit or have general questions on nonprofit law you have come to the right place! The questions that follow will help you determine if an organization is eligible to apply for recognition of exemption from federal income taxation under section 501(a) of the Internal Revenue Code and, if so, how to proceed.

  • National Association of State Charity Officials (NASCO)

    The National Association of State Charity Officials (NASCO) is an association of state offices charged with oversight of charitable organizations and charitable solicitation in the United States. The requirements and procedures for forming charitable organizations differ from state to state, as do the registration and filing requirements for organizations that conduct charitable activities or solicit charitable contributions.

  • Non-profit Organizations - Overview

    A non-profit organization is a group organized for purposes other than generating profit and in which no part of the organization's income is distributed to its members, directors, or officers. Non-profit corporations are often termed "non-stock corporations." They can take the form of a corporation, an individual enterprise (for example, individual charitable contributions), unincorporated association, partnership, foundation (distinguished by its endowment by a founder, it takes the form of a trusteeship), or condominium (joint ownership of common areas by owners of adjacent individual units incorporated under state condominium acts).

  • Understanding Fundraising Law

    Given the increased scrutiny now being directed at nonprofit fundraising campaigns, strict compliance with all applicable federal, state and local laws is more important than ever to prevent even the most well-intentioned effort from turning into a public relations nightmare. Abiding by the law in the fundraising arena is no simple task. Books have been written on the topic. A brief overview of the complicated legal dimensions of fundraising practices, however, provides a framework for preparing a fundraising endeavor and for determining specific questions that should be directed to legal counsel.

  • Unified Registration Statement

    The Unified Registration Statement (URS) represents an effort to consolidate the information and data requirements of all states that require registration of nonprofit organizations performing charitable solicitations within their jurisdictions. The effort is organized by the National Association of State Charities Officials and the National Association of Attorneys General, and is one part of the Standardized Reporting Project, whose aim is to standardize, simplify, and economize compliance under the states' solicitation laws.

  • United States Government Grants was established as a governmental resource named the E-Grants Initiative, part of the President's 2002 Fiscal Year Management Agenda to improve government services to the public. The concept has its origins in the Federal Financial Assistance Management Improvement Act of 1999, also known as Public Law 106-107. Public Law 106-107 has since sunset and is now known as the Grants Policy Committee (GPC).

  • US Government for Nonprofits

    Official information and services from the U.S. government on nonprofit organizations.

United States Charitable Organizations Law by State

Charitable Organizations Law - Europe

  • European Center for Not for Profit Law (ECNL)

    The vision of the ECNL encompasses pluralistic democracies in the region in which the legal environment enables people and their organizations to shape their society through voluntary action. ECNL promotes the strengthening of a supportive legal environment for civil society in Europe,with a focus on Central and Eastern Europe, by developing expertise and building capacity in legal issues affecting not-for-profit organizations and public participation.

  • European Volunteer Centre (CEV)

    The European Volunteer Centre (Centre européen du volontariat, CEV) is a European network of currently 74 mainly national and regional volunteer centres and volunteer development agencies across Europe, that together work to support and promote voluntary activity. CEV channels the collective priorities and concerns of its member organisations to the institutions of the European Union. It also acts as a central forum for the exchange of policy, practice and information on volunteering. The member organisations of CEV represent thousands of volunteer organisations, associations and other voluntary and community groups at local, regional, national and in some cases international level.

  • United Kingdom Charity Commission

    The Charity Commission is the independent regulator for charitable activity * ensuring legal compliance * enhancing accountability * encouraging effectiveness and impact * promoting the public interest in charity to promote the public's trust and confidence.

Charitable Organizations Law - International

  • Canada Charity Central

    Charity Central is a project of the Legal Resource Centre of Alberta, designed to help Canada's Registered Charities understand their responsibilities under the Income Tax Act.

  • International Center for Not-for-Profit Law (ICNL)

    ICNL strives to create a world where civil society can freely develop in all its forms and participate in public decisions. In pursuit of that goal, ICNL's programs and research focus on promoting an enabling legal environment for civil society and public participation worldwide. ICNL helps establish the legal framework for a strong and effective global civil society through: * technical assistance to over 100 countries; * the expertise of our multinational in-house staff and global network of legal specialists; and * our partnerships with civil society representatives, government officials, scholars, and business leaders.

  • United Nations Office for the Coordination of Humanitarian Affairs

    OCHA's mission is to mobilise and coordinate effective and principled humanitarian action in partnership with national and international actors in order to: • alleviate human suffering in disasters and emergencies • advocate for the rights of people in need • promote preparedness and prevention • facilitate sustainable solutions.

Organizations Related to Charitable Organizations Law

  • Grant Writing Tools for Non-profit Organizations

    Non-profit guides are free Web-based grant-writing tools for non-profit organizations, charitable, educational, public organizations, and other community-minded groups.

  • National Council of Nonprofits

    The National Council of Nonprofits is the network of state and regional nonprofit associations serving more than 20,000 member organizations. By linking local nonprofit organizations across the nation through state associations, the National Council helps small and midsize nonprofits manage and lead more effectively, collaborate and exchange solutions, engage in critical policy issues affecting the sector, and achieve greater impact in their communities.

  • Nonprofit Law

    If you are interested in starting a nonprofit or have general questions on nonprofit law you have come to the right place! The questions that follow will help you determine if an organization is eligible to apply for recognition of exemption from federal income taxation under section 501(a) of the Internal Revenue Code and, if so, how to proceed.

Publications Related to Charitable Organizations Law

  • International Journal of Not-for-Profit Law (IJNL)

    The International Journal of Not-for-Profit Law (IJNL) is ICNL's quarterly journal of analysis on global civil society. IJNL addresses legal topics as well as social, cultural, political and economic issues affecting the legal environment. Our readers include attorneys, government officials, grantmakers, scholars, and activists.

  • The Non Profit Times Magazine

    The NonProfit Times, published 24 times a year, is the leading business publication for nonprofit management. It is read by over 85,000 full time nonprofit management executives around the country. The magazine addresses various management functions of the nonprofit organization, from fund raising to technology, from legal to human resource issues, from direct marketing to the latest news and more. Each issue is packed with hard hitting and useful business information on managing their organizations more effectively.

Articles on Related to Charitable Organizations Law

  • Charitable Remainder Unitrust – What Are They
    Unitrusts are standard trusts with a trustee and monetary disbursements to the beneficiaries with an added difference once the trust term expires. Once the trust is no longer paid to the beneficiary, the assets that remain within the unitrust then go to the charity of whichever purposes the trust exist for by the person designating it.
  • Charitable Remainder Unitrust – Adding Beneficiaries
    Understanding how to create and maintain a charitable remainder unitrust is important for the estate owner, and it could lead to several advantages.
  • How Do Non-Profits Engage in Unfair Competition Measures?
    Any type of redirecting consumer traffic and sales away from a business is part of unfair competition practices and activity, and even certain non-profit organizations engage in these situations sometimes. It is important to know when this occurs and how it affects the company so that the owner is able to pursue legal action when the offense is serious enough.
  • Non-Profits and the Establishment of the Organization
    Starting a non-profit organization is important based on the goals of the owner, benefit to the public and the services supplied to those involved in the non-profit. Establishing the entity and ensuring the creation of the organization is valid and processed correctly is important for the owner, and this may require the services of a lawyer to complete.
  • What Is a Non-Profit, and Why Is It Created?
    It is important to understand what a non-profit is before attempting to create one, and this may require research, communicating with local non-profit entities and hiring a lawyer if the details are still confusing. A non-profit may be started by filing paperwork with the Internal Revenue Service to establish tax exemption.
  • Differences between 501 c(3) and 501 c(4) Non-Profit Organizations
    A nonprofit organization under the 501C(3) is one that is for charitable purposes and is exempt based on this Section of the Internal Revenue Service Code, and the 501C(4) is granted to non-profit organizations that are operated for social welfare. The differences between these two non-profit entities are significant even if they are slight.
  • How to Create a Non-Profit Startup and the Need for a Lawyer
    Starting any organization it is important to know what steps to follow, what professionals are involved and the need to hire a lawyer to ensure transactions are legal and legitimate for the entity. The steps to create a non-profit startup are often similar to any other entity, but the owner of the organizations may need some additional research and data to keep it going.
  • Can a Minor Start a Non-Profit Organization Legally?
    Minors have taken part in creating businesses, organizations and churches, and starting a non-profit is not much of a reach for someone under legal age. However, there are often only certain situations that permit the teen to take part in creating a new organization that is legally a non-profit, and these may change over time.
  • California Startup Seeking to Hire Foreign Employee on H-1B Visa
    Whether you are a foreign citizen willing to work in the US or an US employer that wants to hire a foreign employee, below are a number of questions Business Startup Attorneys encounter regarding H-1B visa.
  • After a Riot, Who Pays for the Damage?
    Riots have erupted all over the United States in recent years, often in the wake of racial tensions created by police activities. Often beginning as peaceful protests, these demonstrations sometimes degenerate into violent riots where people and property suffer harm, leaving innocent people to pick up the pieces. This has led many to ask who should pay for the damage after a riot?
  • All Nonprofit Organizations Law Articles

    Articles written by attorneys and experts worldwide discussing legal aspects related to Nonprofit Organizations.

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