nonprofit corporation

   An organization that is incorporated under state laws and approved by both the state's Secretary of State and its taxing authority as operating for educational, charitable, social, religious, civic or humanitarian purposes-either to benefit members of an organization (e.g., a club or mutual benefit society) or for some public purpose (e.g., a hospital, environmental organization, or literary society). A nonprofit corporation has a board of directors and officers (who are normally shielded from personal liability for the organization's debts). A nonprofit corporation can make a profit, but it cannot be designed primarily for profit-making purposes, and the profits must be used for the benefit of the organization or the purpose it was set up to help. Upon dissolution of a nonprofit corporation, any remaining assets must be distributed to another nonprofit corporation, not to the directors. For contributions to the corporation to be deductible as charitable gifts on federal income tax forms, the corporation must submit a detailed application (with a substantial fee) and obtain an Internal Revenue Service ruling that it is established for one of the specific nonprofit purposes spelled out in the Internal Revenue Code. See charity.

Business law dictionary. 2015.

Look at other dictionaries:

  • nonprofit corporation — n. A corporation that does not distribute its income to shareholders or officers as profit and that engages in a purpose such as religion, charity, education, public safety, etc. The Essential Law Dictionary. Sphinx Publishing, An imprint of… …   Law dictionary

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  • Mutual benefit nonprofit corporation — In the United States, a mutual benefit nonprofit corporation or membership corporation is a type of nonprofit corporation chartered by a state government that exists to serve its members. It cannot obtain federal 501(c)(3) non profit status as a… …   Wikipedia

  • Public benefit nonprofit corporation — A Public benefit nonprofit corporation is a type of nonprofit corporation chartered by a state government …   Wikipedia

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  • nonprofit — adjective altruistic, beneficent, benevolent, charitable, eleemosynary, humanitarian, munificent, philanthropic, public service associated concepts: nonprofit corporation Burton s Legal Thesaurus. William C. Burton. 2006 …   Law dictionary

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