Non Profit Organizations

By MIKE SELVON

 A corporation that is formed to fill a particular need, such as educational, literary, scientific, religious or charitable is called a nonprofit organization. Normally, the state and federal governments do not tax those corporations on the income they receive that is in relation to their charity work and purpose because of the beneficial contributions made to society.

They are able to receive both private and public donations and grant money from companies and individuals. There are also some local, state and federal taxes (including income, sales and property) that this type of organization is exempt from having to pay.

Just like any other corporation, a non profit corporation does have a board of directors that implement company policy and make decisions, officers (usually a treasurer, secretary and president) to manage and oversee the regular daily operating of the company, and additional employees to complete other tasks. However, unlike most regular corporations they do not have owners or shareholders. Nor are they owned by any one individual or a group of people and the company cannot be sold.

In the case of nonprofit organizations, directors, officers of the company and members are normally prohibited from making a profit of any type at the expense of the company. But there are some instances where the assets, profit or income can be dispersed to individuals only as compensation for services rendered. This is similar to how assets may be distributed after a company dissolves or when a profit was actually a result of a sale, in which case members may have funds rebated to them in direct proportion to the fees they paid.

There are expenses, such as administrative or promotional, including employee compensation and independent contractors that must be proportionate to the organizations financial capabilities and resources. If the charitable organization does raise funds through charity events, yet consistently uses virtually all of its income for promotional or administrative expenses with little to nothing being distributed to charities, then that usually indicates that the board has failed to exercise the right care and caution.

When considering the forming of a nonprofit organization, keep in mind the articles of incorporation that have to be filed with the state. The forms are not difficult but are important, such as the statement of purpose you will write, as well as indicating that you are aware that certain activities, such as political and legislative purposes, are strictly prohibited. You must also be aware that any assets earned will be used only for exempted purpose, without this you will not be able to file for tax exemption.

Educate yourself about nonprofit organizations from Mike Selvon portal. We appreciate your feedback and welcome your comments at our philantrophy blog where a free audio gift awaits you.

Non Profits

non profit fundraising

By MIKE SELVON

 The term philanthropy is more closely related to a concept than an actual verbatim definition. The term came to us courtesy of the Greeks and means “love for mankind.” This concept is about voluntarily giving, either by a group or an individual that will help support and promote some type of a united common good. This may also include monetary grants and contributions given by foundations, individuals and often corporations, to not-for-profit organizations that work towards a common cause to improve the quality of life for those in need.

As shown in history as a chronicle of philanthropy, it is not a new concept. Surprisingly, it was around in the ancient cultures of Greece, Rome and the Middle East. As a matter of fact, contributions were made to Plato’s Academy and the Christian church in medieval times; they set up trusts to be used with benevolence. Beginning in the late nineteenth century, private foundations donated gifts totaling billions in support of education, the arts, medical research and many other causes.

Some people ask what is the best way to do good or show how thankful they are and others will just automatically write out a check for some non profit organization and call it philanthropy. Naturally, monetary donations are great, but one woman has reminded us that there are other ways, every bit as important. She tells a story of seeing a young boy digging in a dumpster for food.

She took him inside, made him a peanut butter and jelly sandwich and sent him home. A short while later several more kids showed up at her door and everyone got a sandwich. Fortunately, her local community noticed and began to pitch in as well; showing that it only takes one person to make a real difference.

You may be surprised to learn that lower and middle-income donors are much more likely to make charitable donations to charities that benefit the poor than are upper-income households. One study examined giving trends among different income groups.

There have been numerous studies done that break down the figures of donating through philanthropy. Studies showed that 8% of the total giving was donated to charities that meet basic needs, such as food and shelter. Roughly 38% of all giving was done by people with incomes less than $70,000 and 23% went to the poor via non profit organizations and 31% of all donations went directly to serving the needs of the poor.

Educate yourself about philanthropy from Mike Selvon portal. We appreciate your feedback and welcome your comments at our philantrophy blog where a free audio gift awaits you.

Non Profits

non profit fundraising