What Constitutes a Charitable Organization?
The IRS defines a charitable organization as an association that operates in a not-for-profit capacity. A qualified charity must operate as exempt from federal taxation. Charities may be run by religious, scientific or educational groups, or by organizations that foster the arts or international cooperation.
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Tax-Exempt Status
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A tax-exempt charitable organization must file a federal informational tax return if its receipts are in excess of $25,000 in a given year (see Resources below).
Distress Relief
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Charitable organizations like the American Red Cross focus on providing relief to distressed populations, such as those in poverty-stricken locations or disaster areas.
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Education and Science
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Qualified charities exist to further educational opportunities for underprivileged populations and provide enhancements to scientific and medical research. Individuals or stockholders may not realize earnings from such organizations.
Civil Rights
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Charitable organizations such as The American Civil Liberties Union (ACLU) defend civil rights and combat discrimination.
Non-Qualified Organizations
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Action groups that attempt to influence voters to register and support a particular candidate are not qualified charitable organizations.
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