Facts about nonprofit organizations

Facts about nonprofit organizations

Facts about nonprofit organizations

Those people who want to start a non-profit organization to better their community or even the whole world have the best of intentions. They are passionate about a cause. The flaw in their plans is that they think that the government will give them money to operate their organization. This is not the case. There are many charitable organizations in operation despite the economic situation. Grant funding is extremely helpful to the operation of every nonprofit organization.

Operating a tax exempt non-profit organization is similar to starting a business. You have to have a plan, financing people to help your organization run smoothly. Many people think it is as easy as obtaining funding from the government to save the world. That is nave thinking.

Your process begins by applying with the IRS. The IRS has tax codes for these organizations. According to the IRS Publication 557, the tax code ranges from 501(c)(1) to 501(c)(28). The most common and well know code is 501(c)(3). This code applies to religious, educational, and charitable organizations just to name a few. Having a 501(c) code designation will allow your organization tax exempt status.

Most people do not realize that donations come from multiple sources. An organization should take advantage of as many of these sources as possible. Examples of these donations (sustainable income) are donations from the general public, corporate funding, as well grant funding. Funding doesn't necessarily come in the form of cash. An in-kind gift such as equipment is a great source of support. Financing, just like a business is vital to your organization. Operating a nonprofit organization is hard work. If you are not willing to put in the time and sweat, you should not start.

I have been asked many times How I do to operate my organization properly?' To that, I tell them that they should read up on non profits. Many books talk about strategies for running an organization. Some of these books are better than others. Also, the internet is a great source. Contacting the IRS is definitely worth the time.

A well run organization will run smoothly. The staff and volunteers are dedicated to the cause. A well run organization has a better plan and strategy. There is no reason why small nonprofit organizations cannot grow and achieve their goal of making the world a better place.

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