Does a non-profit org have to distribuite all its income at the end of each year?
2007-12-26 10:17:03 · 4 answers · asked by ballyucanb 1 in Business & Finance ➔ Corporations
I have helped several friends start non-profit theatres and I can say that you do not need to redistribute all income at the end of the year. Basically, when it comes to profit, running a non-profit does not mean that you cannot make a profit.
What it means is that you cannot have shareholders to distribute dividends to. You have to either pump all the profit back into your non-profit or to another charity.
Also, be sure to reward yourself with an appropriate salary for the work that do. This is one big mistake that many failing non-profits make. They do not pay themselves an appropriate amount and thus this makes it hard for them to keep going.
There is no reason that your non-profit cannot be your main source of income. In fact, many of my friends now make their non-profits their job... although a job that they really love.
2007-12-26 10:49:48 · answer #1 · answered by stokedcoach 2 · 0⤊ 0⤋
No. That would make it impossible for most non-profits to operate.
2007-12-26 10:23:10 · answer #2 · answered by Judy 7 · 1⤊ 0⤋
While I'm inclined to say "no" you do not - I would recommend you look it up for yourself on the IRS website to make sure.
2007-12-26 10:26:05 · answer #3 · answered by Anonymous · 0⤊ 0⤋
No. It is important that they keep money for future expenses, investment, etc.
2007-12-26 14:32:46 · answer #4 · answered by InsideMan77 2 · 0⤊ 0⤋