Nonprofit organization

organization that uses its income to achieve its goals rather than distributing it as profit or dividends

A nonprofit organization (NPO), or non-business entity,[1] is an organization which does not give its surplus income to owners or shareholders.

It uses its revenue and/or capital to achieve its purpose or mission.[2] The decision to adopt a non profit legal structure is one that will often have tax benefits. Governments may see them as supporting activities which help the community.

In England this is more often referred to as "not-for-profit", and includes local and national government. Non-profit organizations are allowed to pay their workers, but sometimes workers at non-profit organizations are volunteers who do not get paid for their work.

Sometimes a non-profit may make money to help other people, which might include helping them start their own business or providing them with food, clothing or shelter. Some non-profits try to help endangered animals or the environment. Some non-profits are small groups of people such as a block association or community group. Others such as trade unions, universities or religions are large and well established, with many assets and many paid workers.

When a non-profit organization deals with politics or international issues it can be called a non-governmental organization or NGO. The Wikimedia organization, which runs Wikipedia is a non-profit. It is based in Florida in the United States. It is also a not-for-profit corporation.


  2. Hansmann R.B. 1980. The role of nonprofit enterprise. Yale Law Journal, 835-901.