20 Types of Nonprofits: Complete Guide To 501(c) Organizations (2025)

The different types of nonprofits under IRS 501(c), explained—plus tax benefits, eligibility, and how to choose the right structure.

Thinking about starting a business that prioritizes social good? Nonprofits can be just as impactful and rewarding as for-profit ventures. But they come with unique structures, challenges, and tax rules to understand upfront.

In the US, the Internal Revenue Service (IRS) recognizes more than 30 types of nonprofits under the 501(c) tax code, which range from very broad to very niche. Whether you want to start a public charity or form a veterans organization, choosing the right structure is key.

Ahead, learn what a nonprofit is, the most common types of tax-exempt organizations, how they differ, and what each is best suited for. 

What is a nonprofit?

A nonprofit organization (NPO) is a business operated to advance a public or social benefit rather than generate a profit for owners. The IRS grants tax-exempt status to these entities under section 501(c) of the Internal Revenue Code, provided that they serve a qualifying social cause like education or charity.

While NPOs are focused on the greater good, they can and should generate revenue—but those funds should be reinvested into their mission. Unlike for-profit businesses, nonprofits are prohibited from distributing profits they generate toward anyone or anything other than advancing the organization.

📚Learn: What Is a Nonprofit? Definition and Types of Nonprofits

Key characteristics of nonprofit organizations

Nonprofit organizations share several fundamental characteristics that distinguish them from for-profit businesses:

• Non-distribution constraint: Profits cannot be distributed to members, directors, or officers
• Mission-driven purpose: Activities are centered around a specific social, educational, religious, or charitable mission
• Public benefit focus: Exists to serve the public interest rather than private gain
• Tax-exempt status: Eligible for exemption from federal income taxes under specific IRS code sections
• Formal structure: Requires official incorporation documents, bylaws, and governance systems
• Board governance: Overseen by a volunteer board of directors responsible for strategic direction

Differences between nonprofits and not-for-profits

“Nonprofit” and “not-for-profit” are often used interchangeably, but they differ in purpose and tax treatment. Nonprofits serve the public good and typically qualify for tax-deductible donations. Not-for-profits exist to benefit members and usually don’t qualify for deductions.

📚Learn: Nonprofit vs. Not-for-Profit: What’s the Difference?

Characteristic	Nonprofit organizations	Not-for-profit organizations
Primary focus	Public benefit and charitable purposes	Member benefit and social/recreational purposes
Tax status	Almost always tax-exempt under 501(c) code	May or may not be tax-exempt
Donations	Eligible to receive tax-deductible donations	Donations generally not tax-deductible
Examples	Charities, educational institutions, hospitals	Social clubs, homeowners associations, hobby groups
Scope	Typically larger with broader missions	Often smaller with more limited purposes
Regulation	Highly regulated with strict reporting requirements	Less regulated with fewer reporting requirements

How to choose the right nonprofit structure

Choosing the right nonprofit structure is an important step in forming your organization. The right classification impacts everything including tax benefits, governance, fundraising, and even whether you can sell products or services to support your mission.

Questions to ask before selecting a nonprofit type

Consider these key questions to narrow down which nonprofit classification best supports your goals:

• What is your primary purpose or mission? Different nonprofit types are designed for specific purposes, such as charitable work, social welfare, or member benefits.
• Will you seek tax-deductible donations? Only certain nonprofit types, particularly 501(c)(3) organizations, can offer tax deductions to donors.
• Who will benefit from your activities? Consider whether your organization primarily benefits the general public, a specific community, or your own members.
• What funding model will you use? Some nonprofit structures are better suited for donation-based funding, while others work well with membership dues or service fees.
• Will you engage in political activities? Certain nonprofit types permit lobbying and political advocacy, while others (like 501(c)(3) organizations) face significant restrictions.
• What governance structure do you envision? Consider the level of transparency and oversight required for different nonprofit classifications.

Common nonprofit formation mistakes to avoid

When establishing an NPO, be careful to avoid these common pitfalls:

• Choosing the wrong tax-exempt status based on incomplete understanding of IRS requirements
• Failing to establish proper governance structures like bylaws and board procedures
• Neglecting state-level requirements that exist alongside federal regulations
• Inadequate recordkeeping systems for tracking activities and finances
• Assuming all revenue will be tax-exempt—including ecommerce sales or services— without understanding the rules for unrelated business income
• Overlooking ongoing compliance requirements like annual filings and public disclosures

Not sure which structure fits your mission? A nonprofit attorney or tax adviser can help you avoid missteps and stay compliant from day one.

20 types of nonprofit organizations

1. 501(c)(3): Charitable organizations
2. 501(c)(4): Civic leagues and social welfare organizations
3. 501(c)(5): Labor and agricultural organizations
4. 501(c)(6): Trade and professional associations
5. 501(c)(7): Social and recreational clubs
6. 501(c)(8): Fraternal societies
7. 501(c)(9): Employee beneficiary associations
8. 501(c)(10): Domestic fraternal societies
9. 501(c)(11): Teachers’ retirement fund associations
10. 501(c)(14): State-chartered credit unions
11. 501(c)(15): Mutual insurance companies
12. 501(c)(16): Crop financing cooperatives
13. 501(c)(17): Supplemental unemployment benefit trusts
14. 501(c)(18): Employee-funded pension trusts
15. 501(c)(1): Congressional chartered organizations
16. 501(c)(2): Title-holding corporations
17. 501(c)(22): Withdrawal liability payment funds
18. 501(c)(23): Pre-1880 veterans organizations
19. 501(c)(26): State health risk pools
20. 501(c)(27): Workers’ compensation reinsurance organizations

Nonprofits come in many forms, from credit unions to social advocacy groups focused on public safety. The IRS classifies these tax-exempt organizations under section 501(c), with each type serving a specific mission.

While most nonprofit organizations are exempt from federal income tax, only some can extend tax deductions to their donors. Many classifications are highly specific and sometimes used by larger nonprofits to create subsidiaries or to limit liability. If tax breaks are your main motivator, a nonprofit isn’t the right path; these entities require oversight and a mission-driven purpose.

These are 20 common types of nonprofits you may encounter as you start or grow your own nonprofit.

501(c)(3): Charitable organizations

• Best suited for: Public charities, religious groups, schools, and foundations
• Examples: American Red Cross, Habitat for Humanity, local food banks
• Funding: Tax-deductible donations, grants, endowments

Most nonprofits fall under 501(c)(3), such as public charities and religious, educational, and scientific organizations. Examples include disease research institutions, private foundations, churches and synagogues, and traditional charitable organizations supporting education or disaster relief. Donations made to these types of nonprofits are tax deductible.

As of 2023, there were 1.5 million 501(c)(3) organizations, including religious ministries, charities, and other nonprofits, showing steady growth from 1.48 million in 2022 and 1.43 million in 2021.

Public charities vs. private foundations

Within the 501(c)(3) classification, organizations are classified as either public charities or private foundations. While both can receive tax deductible donations, they differ in how they’re funded, how they operate, and the level of oversight they face.

Category	Public charities	Private foundations
Funding source	Support from the public or government	Single individual, family, or corporation
Primary activities	Operate direct programs	Provides grants to other nonprofits
Regulatory oversight	Fewer restrictions	Stricter oversight
Distribution rules	No required minimum	Must distribute a set percentage of assets annually
Examples	Hospitals, universities, community foundations	Bill & Melinda Gates Foundation, Ford Foundation

Religious organizations

• Churches, synagogues, mosques, and other houses of worship
• Religious schools and missionary organizations
• Special tax exemption from filing Form 1023 application in many cases
• Protected religious autonomy under First Amendment considerations

Educational institutions

• Schools, colleges, and universities
• Museums and libraries
• Educational research organizations
• Must present objective, full view of relevant facts for public benefit

Scientific organizations

• Medical research institutions
• Environmental research groups
• Technology development for public benefit
• Must conduct research in the public interest, not for private commercial advantage

501(c)(4): Civic leagues and social welfare organizations

• Best suited for: Advocacy groups and nonprofits focused on community welfare or public policy
• Examples: American Association of Retired Persons (AARP), Sierra Club
• Funding: Donations (not tax-deductible), membership dues

These nonprofits have fewer restrictions when it comes to political activity, such as lobbying or fundraising for candidates. The NRA and ACLU are 501(c)(4) organizations that engage in political activity. 501(c)(3) organizations are prohibited from direct political participation, including endorsing candidates or donating to campaigns. Donations to this type of organization are not tax-deductible.

501(c)(5): Labor and agricultural organizations

• Best suited for: Labor unions and farming cooperatives
• Examples: National Education Association, American Postal Workers Union
• Funding: Member dues, limited business income

The mission of these types of nonprofits aims to improve working conditions and promote efficiency in farming, agriculture, and labor. These nonprofits can engage in political activity and are tax exempt. Like labor unions, 501(c)(5) organizations are funded through membership dues and donations, which are only potentially deductible as a business expense.

501(c)(6): Trade and professional associations

• Best suited for: Industry groups and professional organizations
• Examples: U. Chamber of Commerce, American Bar Association
• Funding: Membership dues, conference fees, sponsorships

These nonprofits include business leagues—such as associations of insurance brokers, realtors, accountants—along with chambers of commerce, and real estate boards. Their purpose is to promote good business conditions, and they may engage in political activity. They are funded by membership dues as well as paid educational programs.

501(c)(7): Social and recreational clubs

• Best suited for: Member-based clubs for recreation or socializing
• Examples: Rotary Club chapters, university alumni clubs, social dance organizations
• Funding: Member fees, event income

These are not-for-profit organizations, meaning their purpose is member enjoyment, not advancing a charitable cause or public benefit. Common examples include country clubs and amateur sports leagues. They are considered to be tax exempt organizations.

501(c)(8): Fraternal societies

A 501(c)(8) is a not-for-profit lodge society (meaning it meets regularly at a designated location) and provides benefits to its members, such as life, sickness, or accident coverage. They include service clubs, lineage clubs, and secret societies. For example, the Knights of Columbus are one of the largest 501(c)(8) organizations in the US. Donations to these organizations are not tax-deductible.

501(c)(9): Employee beneficiary associations

These nonprofits, called voluntary employee benefits associations, or VEBA, provide payment to their members and their dependents in the event of an inability to work (due to illness or injury) or some other unforeseen event. Members must have a common bond, such as being employees of the same employer or members of the same labor union. These are typically funded by both the employers and the employees.

501(c)(10): Domestic fraternal societies

Unlike 501(c)(8) and (9) organizations, these groups don’t provide payment to members. Instead, they support charitable or social causes selected by their members. Examples include certain Freemason lodges and other fraternal orders that focus on community giving rather than providing insurance or financial benefits to members.

501(c)(11): Teachers’ retirement fund associations

These organizations source income through dues paid by public school teachers, tax revenues, and investment income. The funds pay the pensions for retired public school teachers.

501(c)(14): State-chartered credit unions and mutual reserve funds

These organizations offer financial services, often at reduced rates, to members and the broader community. They generate income through standard lending practices and government grants.

501(c)(15): Mutual insurance companies

These nonprofits offer low cost insurance plans to local members, usually for property damage, burials, and funerals.

501(c)(16): Crop financing cooperatives

Under 501(c)(16), organizations and groups of farmers come together to pool resources for agricultural operations, usually to buy equipment, cultivate crops, take care of livestock, or handle shipping and marketing operations.

501(c)(17): Supplemental unemployment benefits trusts

This type of nonprofit exists to provide financial support to members—employees of the same employer—who are permanently or temporarily unemployed.

501(c)(18): Employee-funded pension trusts

These pension trusts—created before June 25, 1959—are funded entirely by employee contributions and used to pay member retirement benefits.

501(c)(1): Congressional chartered organizations

These types of nonprofits are organized by an act of Congress, such as federal credit unions. Because these organizations are set up by federal lawmakers, there is no application process and they don’t file tax returns.

501(c)(2): Title-holding companies

501(c)(2) organizations hold property (usually real estate or intellectual property) on behalf of other tax-exempt organizations. A 501(c)(2) can only be formed as a subsidiary of another nonprofit corporation, and they exist to shield property-owning organizations from some forms of legal liability. Many private foundations partake in this type of nonprofit. Title holding corporations generally fall under this category.

501(c)(22): Withdrawal liability payment funds

These funds help employees meet financial obligations when withdrawing from multi-employer pension plans. They are funded by the employers themselves.

501(c)(23): Pre-1880 veterans organizations, 

This designation is solely for veterans organizations established before 1880, providing insurance and benefits to members. As with 501(c)(19) organizations, these must contain a membership of at least 75% armed services members, past or currently active. Funding comes from donations and grants.

501(c)(26): State health-risk pools

These organizations cover patients with preexisting medical conditions who may qualify for traditional health insurance. Funding comes from donations and grants.

501(c)(27): Workers’ compensation reinsurance organizations

These nonprofits offer workers’ compensation reinsurance to member organizations. They are funded by grants and membership dues.

Other 501(c) organizations

The IRS recognizes additional 501(c) organizations that serve specialized legal or public interest purposes. These include:

• 501(c)(21): Trusts that provide benefits to individuals affected by black lung disease
• 501(c)(24): Trusts created under ERISA (Employee Retirement Income Security Act)
• 501(c)(28): Trusts established by the Railroad Retirement Board

These entities are highly specialized and typically not relevant for most nonprofit founders.

Tax implications for different nonprofit types

Understanding the tax implications of different nonprofit structures is crucial for both the organization and its supporters.

Tax exemption vs. tax-deductible donations

It’s important to understand the difference between tax-exempt status and the ability to offer tax-deductible donations:

• Tax exemption applies to the organization itself, meaning it doesn’t pay federal income tax on related activities. Most 501(c) organizations receive some form of tax exemption.
• Tax-deductible donations benefit the donors, allowing them to reduce their taxable income by the amount donated. Only donations to certain nonprofit types—primarily 501(c)(3) organizations—qualify for tax deductions.

This distinction has significant implications:

• 501(c)(3) organizations: Both tax-exempt and able to receive tax-deductible donations
• 501(c)(4), (6), and most others: Tax-exempt but unable to offer tax deductions to donors
• Non-501(c)(3) organizations: Donors cannot claim tax deductions for their contributions

Annual filing requirements by organization type

Different nonprofit classifications have specific filing requirements to maintain their tax-exempt status:

• Form 990 series: Most tax-exempt organizations must file an annual information return
• Form 990: For larger organizations
• Form 990-EZ: Simplified form for mid-sized organizations
• Form 990-N (e-Postcard): Electronic filing for small organizations
• Filing exceptions: Churches and certain church-affiliated organizations are exempt from filing
• Public disclosure requirements: Most nonprofits must make their returns available for public inspection
• Unrelated business income: Regardless of exempt status, organizations must pay taxes on unrelated business activities

Tax-exempt organizations may request a six-month extension to file their Form 990 by submitting IRS Form 8868. However, this extension does not delay any taxes owed.

Next steps for starting your nonprofit organization

Starting a nonprofit can be a powerful way to turn your mission into lasting impact. But with more than 30 types of tax-exempt status recognized by the IRS, choosing the right structure matters. 

Any potential nonprofit founder should consult an experienced nonprofit lawyer or relevant accounting professional for guidance through the process. This way, you can avoid selecting the wrong type of nonprofit for small business and risk forfeiting crucial tax-exempt status.

Planning to fund your mission by selling products or services online? Shopify offers tools to help nonprofits launch ecommerce storefronts, raise funds, and grow impact online.

Types of nonprofits FAQ

What are the biggest challenges faced by nonprofits?

Nonprofit organizations often struggle to generate the revenue and funding needed to continue operations. It can also be challenging to raise money, build a sound business model, and lower profit margins at scale.

What is the difference between nonprofit and not-for-profit?

While often used interchangeably, there are several differences. A nonprofit organization does not earn profits for its shareholders and is almost always tax-exempt. Not-for-profit organizations do not operate with the sole intention of making profit, but can be structured as corporations and associations and may or may not be tax exempt.

What are 3 common types of nonprofits?

The most common nonprofit types are public charitable organizations, educational institutions, and religious organizations—all of which fall under 501(c)(3).

How do I register a nonprofit organization?

1. Incorporate at the state level by filing articles of incorporation
2. Apply for an EIN from the IRS
3. File for 501(c) tax-exempt status using Form 1023 or 1023-EZ
4. Register for state tax exemptions and charitable solicitation permits as required

Can nonprofits make a profit?

Yes, nonprofits can and should generate positive revenue (profit). The key distinction is that profits must be reinvested in the organization’s mission rather than distributed to owners or shareholders. This “non-distribution constraint” is fundamental to maintaining nonprofit status.