Benefits of Non Profit Organizations
There are several benefits to forming a non profit organization. Innovative non profit organizations have helped institutions influence elections and change laws, business practices and cultural focus. They provide a learning platform that is used to organize and educate the public around health, poverty and health among other issues.
1. Less competition
The main benefit of non profit organizations is that they have less competition than other institutions. For instance, when non profit organizations have different causes, it means there will be less competition in terms of winning over possible volunteers, contributors, participants, board members and members within the organizations. This equates to more funding coming to the non profit organization that is innovative.
2. Strength in numbers
Since funds are normally limited for donors, non profit organizations rely on grants from other funding sources to operate. For this reason, innovative non profit organizations garner more donations since they have the ability to bring together more people and solicit funding from contributors. Donors might feel the need to spend their money on innovative organizations that do not rely on funding from other sources.
3. Tax exemption
The other advantage of non-profit organizations is that they receive exemptions from state, federal and state taxes. Therefore, they might not be required to pay sales tax or income tax, and property tax.
4. Grants
Most governmental bodies and grant-making foundations will only award donations to legally formed non profit organizations. On the other hand, public contributors also receive tax breaks through public charities.
5. Helps to fill unfulfilled needs
Non profit organizations also play the role of filling the unfulfilled needs by creating a win-win situation to ensure they focus on a cause that is not receiving help.
Forming a non profit organization requires times, money and effort. Because it operates under local, state and federal law, the use of attorneys and accountants might well prove necessary.
