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Tax Exempt Not for Profit Organizations - Non Profits
What are Non Profit Organizations?
They are corporations that have been granted tax exempt status under section 501 (c) (3) code of the Internal Revenue Service. The reason for this exemption is suppose to be for the uplifting of society. When we speak of profit motive the definition is simple the founder and the board of the non-profit are stewards not owners.
The owner of a for profit business is investing his or her time, talent and treasure in a business for personal financial gain. This is not case for a steward of a non-profit. The Executive Director and the staff is entitled to a salary and retirement plan.
What types of taxes are nonprofits exempt from?
Sales and Use Taxes
Sales and Use Taxes
Sales and Use Taxes
- Non Profit Organizations are exempt from being charged sales taxes on items they purchase for example copier at staples
Real Estate Taxes
Sales and Use Taxes
Sales and Use Taxes
- Real estate taxes are exempt Caveat in the case of non profit being run fron a home.
- If you want to sale the home and benefit from the sale you will have to do a recovery.
Personal Property
Sales and Use Taxes
Personal Property
- Personal property such as computers, items used run the on profit are tax exempt.
- You do not pay for the state annual business tax
Taxes You Pay
Large Organizations
Personal Property
- Non Profit organizations employment taxes on staff salaries
- As well as unemployment taxes. The same as a for profit business
Tax Form Filed 990
Large Organizations
Large Organizations
- Small nonprofits under $50,000 file a 990 N (e postcard)
- 990 EZ Gross receipts less than $200,000, and Total assets less than $500,000
Large Organizations
Large Organizations
Large Organizations
- Any non-profit with donations over $200,000 and asset more than $500,000.These organizations will file a 990