For those who are new to non-profit organizations, the use of the terms "non-profit organization" and "non-profit organization" is often very confusing. Many organizations insist on calling themselves one or the other, and even some legal and accounting professionals try to draw a line between the organizations that belong to them. Although there are some technical differences between the two, they are usually used interchangeably.
Some people think that "non-profit" should refer to organizations that are never profitable - every penny is used for the main purpose of the organization. Essentially, this includes every charity, NGO, civil society, private volunteer organization, and all other types of non-profit organizations. Often, the goal is to clarify that the company can only solve the problems that need to survive - trying to re-evaluate potential members and donors, and no one is profiting from it.
Some people try to divide non-profit organizations into unknown organizations, such as social clubs, civil society organizations, professional organizations, etc., while placing charitable organizations with non-profit organizations under non-profit organizations. While this distinction may make sense, the inconsistencies in definition make it difficult to apply. Often, the most important thing is that the group's purpose is to emphasize its inherent definition - this organization is not designed to distribute profits to individuals at the end of the year.
Laws and regulations [including federal and state] actually clarify that "non-profit" and "non-profit" are obvious. However, the IRS does provide a practical distinction in their own definitions. According to Infernal Revenue Service, "non-profit" refers to specific activities, such as hobbies. A "non-profit organization" is an organization established for purposes other than making a profit. This definition does not necessarily mean charity, but includes any organization that does not intend to make a profit. Amateur sports leagues, quilt associations, social clubs and charitable organizations all fall into this definition.
In addition to the US Internal Revenue Service, the distinction between these terms can also be found in the context of the person using them. Lawyers, accountants, and colleges tend to choose the term non-profit organization, and experienced fundraisers [and many in the non-profit organization] prefer to use non-profit organizations. Similarly, fundraisers may prefer non-profits because it makes it clearer that no one is profiting from fundraising activities. Or, it may be just an exclusive strategy that can help those insiders identify outsiders... but this is an illegal organized plot!
The last question that causes unreasonable disagreements is whether non-profit organizations should use hyphens. Non-profit organizations have no obvious meaning to non-profit organizations, but hyphens are often used in non-public interest references. Active philanthropists tend to ignore hyphens. Technically, a hyphen indicates an adjective modifying another. Here, "non" is modifying "profit"...not that this clarification provides any particularly useful knowledge, except that the single word nonprofit is a noun, and non-profit is technically a modified adjective, so an extra is needed A noun attached, such as a non-profit organization.
No matter what terminology you intend to use for your nonprofit organization, just make sure you have prepared enough arguments. Someone will ask this...maybe several people. As long as you sound like you know what you are saying, your argument will repeat from
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Orignal From: Non-profit and non-profit - Is there a difference?
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