The non-profit sector is an important component of the socio-economic condition of a country; it functions as a "third column" facilitating consensus between society, business, and government. According to the Internal Revenue Service (IRS), the following organizations have a non-profit status: churches, charitable and religious organizations, contributors, political organizations, and private foundations. Having a status as a non-profit is a major factor in determining the mission, goals, strategic planning, management, accountability and funding of an organization.
The Non-Profit Sector in the United States:
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Image (left): "Helping Hands"
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Financial support provided by non-profits to different parties can have two main purposes: charity and philanthropy. Charity is viewed as a way to alleviate suffering (for instance, building shelters and providing food to the people going through a crisis), while philanthropy is considered to be an investment in social-oriented programs with expected socio-economic return (e.g., organizing after-school literacy lessons for the third grade pupils).
Another important distinction within the non-profit sector is the existence of social enterprises which operate as profit-seeking entities which support the goals of a non-profit with which they are associated. For instance, the food court operating within the premises of a faith-based organization is a social enterprise which serves as a funding source while the organization's mission remains religious.
The non-profit sector has long been a subject of interest to scholars, businessmen, civic leaders, and politicians indicating its critical nature and high importance.