The Advantages of Non Profit Organizations

Non-profits form an important part of the charitable world.

Non-profits have created a role for themselves as vital providers of social services around the world. Acting as a supplement to government aid, non-profits have many advantages over other kinds of organizations in dealing with the world's problems. Explicitly run for the benefits of others, non-profits offer a way around the government solution for every problem. Without non-profits, many people around the world would soon find themselves in dire straights.

Tax Law

Under U.S. federal law, non-profit organizations are exempt from paying the taxes normally due for an organization. This is provided as long as non-profits remain truly non-profitable, using all of their income for the benefits of others. As well, individuals who donate their money to non-profit organizations can deduct that money, up to a certain amount, from their income tax. This maximizes the good non-profits can produce

Diversity

One of the great advantages of non-profits when contrasted with government action is the diversity of approaches that are available. At any given time a large number of non-profits focus on similar issues, each using slightly different methods. The results of the successes and failures of non-profits allow for knowledge to increase on what works and what doesn't. Non-profits form a kind of free market of ideas for charity.

Wealth Transfers

Wealth is created in the private sector through the activities of business and commerce. This wealth creation increases the well-being of everyone as society as a whole becomes more wealthy. Nevertheless, the problem of how more of the wealth created by private individuals might be devoted to helping the poor still exists. Using the government to do this means forcibly taking the assets of individuals. Non-profits offer another path through voluntary donations.

Advocacy

Many non-profits that focus on a particular issue can become advocates for that issue. This not only helps to alleviate the problem with their own efforts; it brings the issue to the attention of other non-profits and government agencies. Due to their independence, non-profits can attain a credibility that is unattainable for actors in the public sector. Non-Sprofits have great advantages in distributing information.

References

• New York Times: Nonprofits Fear Losing Tax Benefit
• New York Times: Online Giving, One Person at a Time
• Atlantic Monthly: 3 Lessons From a Leading D.C. Food Nonprofit
• Atlantic Monthly: Nonprofit News - How Start-ups Can Pay Their Way
• Wall Street Journal: Once-Robust Charity Sector Hit With Mergers, Closings
• California Association of Nonprofits: A Short History of the Nonprofit Sector

Resources

• Charity Navigator
• JustGive.org
• Better Business Bureau: For Charities and Donors