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A nonprofit corporation is any legal entity which has been incorporated under the law of its jurisdiction for purposes other than making profits for its owners or shareholders. Depending on the laws of the jurisdiction, a nonprofit corporation may seek official recognition as such, and may be taxed differently from for-profit corporations, and treated differently in other ways.


Public-benefit nonprofit corporations

A public-benefit nonprofit corporation is a type of
nonprofit A nonprofit organization (NPO) or non-profit organisation, also known as a non-business entity, not-for-profit organization, or nonprofit institution, is a legal entity organized and operated for a collective, public or social benefit, in co ...
corporation A corporation is an organization—usually a group of people or a company—authorized by the state to act as a single entity (a legal entity recognized by private and public law "born out of statute"; a legal person in legal context) and ...
chartered by a
state government A state government is the government that controls a subdivision of a country in a federal form of government, which shares political power with the federal or national government. A state government may have some level of political autonom ...
, and organized primarily or exclusively for
social Social organisms, including human(s), live collectively in interacting populations. This interaction is considered social whether they are aware of it or not, and whether the exchange is voluntary or not. Etymology The word "social" derives from ...
, educational,
recreational Recreation is an activity of leisure, leisure being discretionary time. The "need to do something for recreation" is an essential element of human biology and psychology. Recreational activities are often done for enjoyment, amusement, or pleas ...
or charitable purposes by like-minded citizens. Public-benefit nonprofit corporations are distinct in the law from
mutual-benefit nonprofit corporation A mutual-benefit nonprofit corporation or membership corporation is a type of nonprofit corporation in the US, similar to other mutual benefit organizations found in some of common law nations, chartered by government with a mandate to serve the ...
s in that they are organized for the general public benefit, rather than for the interest of its members. They are also distinct in the law from religious corporations.


Religious corporation

A religious corporation is a nonprofit corporation organized to promote religious purposes. Often these types of corporations are recognized under the law on a subnational level, for instance by a state or
province A province is almost always an administrative division within a country or state. The term derives from the ancient Roman ''provincia'', which was the major territorial and administrative unit of the Roman Empire's territorial possessions out ...
government. The government agency responsible for regulating such corporations is usually the official holder of records, for instance a state Secretary of State. Religious corporations are formed like all other nonprofit corporations by filing articles of incorporation with the state. Religious corporation articles need to have the standard tax exempt language the IRS requires. Religious corporations are subject to less rigorous state and federal filing and reporting requirements than many other tax-exempt organizations, such as mutual benefit nonprofit corporations, or public benefit nonprofit corporations. Depending on the state in which they are located, they may also be exempt from some of the inspections or regulations governing non-religious groups performing the same services.


Corporation sole

Religious corporations are permitted to designate a person to act in the capacity of corporation sole.


Mutual-benefit nonprofit corporations

A
mutual-benefit nonprofit corporation A mutual-benefit nonprofit corporation or membership corporation is a type of nonprofit corporation in the US, similar to other mutual benefit organizations found in some of common law nations, chartered by government with a mandate to serve the ...
or membership corporation, in the United States, is a type of
nonprofit A nonprofit organization (NPO) or non-profit organisation, also known as a non-business entity, not-for-profit organization, or nonprofit institution, is a legal entity organized and operated for a collective, public or social benefit, in co ...
corporation A corporation is an organization—usually a group of people or a company—authorized by the state to act as a single entity (a legal entity recognized by private and public law "born out of statute"; a legal person in legal context) and ...
chartered by a state
government A government is the system or group of people governing an organized community, generally a state. In the case of its broad associative definition, government normally consists of legislature, executive, and judiciary. Government i ...
that exists to serve its members in ways other than obtaining and distributing profits to them. Therefore, it cannot obtain
IRS The Internal Revenue Service (IRS) is the revenue service for the United States federal government, which is responsible for collecting U.S. federal taxes and administering the Internal Revenue Code, the main body of the federal statutory tax ...
501(c)(3) A 501(c)(3) organization is a United States corporation, trust, unincorporated association or other type of organization exempt from federal income tax under section 501(c)(3) of Title 26 of the United States Code. It is one of the 29 types of ...
non-profit status as a
charitable organization A charitable organization or charity is an organization whose primary objectives are philanthropy and social well-being (e.g. educational, religious or other activities serving the public interest or common good). The legal definition of a ...
. A mutual-benefit corporation can be non-profit or not-for-profit, but it still must pay regular corporate tax rates. A mutual benefit corporation will pay the same taxes as a regular for-profit corporation, with C corporation tax rates. Mutual benefit corporations must still file tax returns and pay income tax because they are not formed for a purpose from which anyone in the world could benefit. Mutual benefit corporations are formed for nonprofit purposes like managing a condo association, a downtown business district, or a homeowners' association. A
utility cooperative A utility cooperative is a type of cooperative that is tasked with the delivery of a public utility such as electricity, water or telecommunications to its members. Profits are either reinvested for infrastructure or distributed to members ...
is an example of an MBNC.


See also

*
Civic society In the United Kingdom, a civic society is a voluntary body or society which aims to represent the needs of a local community. Some also take the role of an amenity society. A civic society may campaign for high standards of planning of new build ...


References


External links


Organization of California Nonprofit, Nonstock Corporations
{{Charity * Public benefit corporations