Basically, i am looking to start a business and will be offering loans for profit. But i am also considering providing some non-profit services.
2007-02-07 11:52:08 · 5 answers · asked by John S 2 in Business & Finance ➔ Small Business
John,
You will need separate entities to operate a for-profit business where benefits can be distributed to you as the owner, and to have the benefits of tax avoidance on your non-profit activities where benefits cannot be distributed to you.
This type of non-profit or not-for-profit organization is called a 501(c)3 corporation and is governed by IRS regulation. It is permissible for it to earn a profit, but that profit cannot be distributed to the owner. Secondly, the org must meet the requirements of 501(c)3 organzations. See IRS Publication 557 (3/2005), Tax-Exempt Status for Your Organization @ www.irs.gov.
Depending upon the non-profit objectives you have and how you invest the funds, it may be possible to deduct your contributions from the taxable income of the for profit business. If you intend to provide the services rather than make contributions, consider the 501(c)3 organization.
Good Luck.
2007-02-07 12:30:51 · answer #1 · answered by planningresult 4 · 0⤊ 0⤋
You could be a not for profit. There is a difference between a non-profit and not for profit. A non profit can't show any profit on its books. A not for profit company can, but show very little. I believe it's about 20% or something like that. You can research this online. It sounds like you'd be hard pressed to do that, though. Might as well just set up too companies.
2007-02-07 11:56:10 · answer #2 · answered by Anonymous · 0⤊ 0⤋
The company is either for profit or a non-profit. You can be a non-profit if you are registered that way. In that case, the company can make a profit but you cannot take the profit out.
2007-02-07 11:57:47 · answer #3 · answered by Anonymous · 0⤊ 0⤋
Yes and no. You can have for-profit and non-profit together phsyically but legally they have to be separate -- so you'll have to have a business number AND a non-profit number.
For example, a church (non-profit) can have a bookstore (business), but they have to be registered separately.
2007-02-07 12:18:38 · answer #4 · answered by Anonymous · 0⤊ 0⤋
nope.and I mean nope
2007-02-07 11:54:43 · answer #5 · answered by Anonymous · 0⤊ 0⤋