Do you really want a nonprofit?

Many people think, “Hey, I want to form an entity to do some good in the world,” and assume that the entity has to be a nonprofit.  After all, nonprofits are the only type of organization that can really achieve charitable goals, right?

Wrong.

Wanting to do something nice for other people does not automatically translate into a mandate to form a nonprofit organization.  While it is obviously in my own interest for people to pay me to complete the 501(c)(3) tax status filing, I always ask clients why they want to go through that process.  If the answer is simply a desire to generate funds to donate to a particular group, for instance, then they may be better off forming a company dedicated to passing along proceeds from certain business activities, saving them a lot of time and money.

Have any questions on this post?  Contact me at abigail@asalisbury.org.

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Please note:  This blog is intended as general educational information only, and should not be considered legal advice or a substitute for consulting a lawyer.