501(c)

AAA

DEFINITION of '501(c)'

A subsection under the United States Internal Revenue Code. The subsection relates to non-profit organizations and tax law and identifies which nonprofit organizations are exempt from paying federal income tax

INVESTOPEDIA EXPLAINS '501(c)'

Under subsection 501(c) there are 12 other sections that separate the different organizations according to operations. The most common include:

c(1) - Any corporation that is organized under an act of Congress that is exempt from federal
income tax
c(2) - Corporations that hold title of property for exempt organizations
c(3) - Corporations, funds or foundations that operate for religious, charitable, scientific,
literary or educational purposes
c(4) - Nonprofit organizations that promote social welfare
c(5) - Labor, agricultural or horticultural associations
c(6) - Business leagues, chambers of commerce, etc. that are not organized for profit
c(7) - Recreational organizations

RELATED TERMS
  1. Accountants for the Public Interest ...

    An organization whose volunteer accountants provide free services ...
  2. Charitable Remainder Trust

    A tax-exempt irrevocable trust designed to reduce the taxable ...
  3. Income Tax

    A tax that governments impose on financial income generated by ...
  4. Internal Revenue Service - IRS

    A United States government agency that is responsible for the ...
  5. Nonprofit Organization

    A business entity that is granted tax-exempt status by the Internal ...
  6. Private Foundation

    A charitable organization that, while serving a good cause, does ...
Related Articles
  1. Personal Finance

    Pass On Wealth To Spread Holiday Cheer

    Find out why money can sometimes be the perfect gift.
  2. Taxes

    Deducting Your Donations

    Generosity may be its own reward, but some charitable giving also provides personal tax benefits.
  3. Retirement

    Gifting Your Retirement Assets To Charity

    There are several things to consider when it comes to this type of charitable giving. Make sure you're well informed.
  4. Insurance

    Encouraging Good Habits With An Incentive Trust

    Money can be a powerful motivator - why not use it to teach your heirs positive lessons?
  5. Investing

    Do nonprofit organizations pay taxes?

    Section 501 of the Internal Revenue Service (IRS) tax code exempts qualified nonprofit organizations from federal taxes. A nonprofit organization is an organization that engages in activities ...
  6. The Affordable Care Act is the largest change to the tax code in 20 years that could affect you when you file that 2014 tax return next year.
    Taxes

    How Might The Affordable Care Act Affect You?

    The Affordable Care Act is the largest change to the tax code in 20 years that could affect you when you file that 2014 tax return next year.
  7. Top fund-raising strategies for nonprofit organizations
    Taxes

    Top Fund-Raising Strategies For Nonprofits

    Top fund-raising strategies for nonprofit organizations
  8. The marginal tax rate is based on a progressive tax system.
    Personal Finance

    What's a Marginal Tax Rate?

    The marginal tax rate is based on a progressive tax system, where tax rates for an individual will increase as income rises. This method of taxation aims to fairly tax individuals based upon ...
  9. Taxes

    How are savings bonds taxed?

    Learn who is responsible for reporting U.S. EE savings bond interest for taxation and when the interest can be reported for proper taxation.
  10. Venezuela has more oil than anyone, and Brazil and Argentina have lots going for them, too, so why can't they get out of their own way economically?
    Economics

    Where NOT To Invest in Latin America

    Venezuela has more oil than anyone, and Brazil and Argentina have lots going for them, too, so why can't they get out of their own way economically?

You May Also Like

Hot Definitions
  1. Commodity

    1. A basic good used in commerce that is interchangeable with other commodities of the same type. Commodities are most often ...
  2. Deferred Revenue

    Advance payments or unearned revenue, recorded on the recipient's balance sheet as a liability, until the services have been ...
  3. Multinational Corporation - MNC

    A corporation that has its facilities and other assets in at least one country other than its home country. Such companies ...
  4. SWOT Analysis

    A tool that identifies the strengths, weaknesses, opportunities and threats of an organization. Specifically, SWOT is a basic, ...
  5. Simple Interest

    A quick method of calculating the interest charge on a loan. Simple interest is determined by multiplying the interest rate ...
  6. Special Administrative Region - SAR

    Unique geographical areas with a high degree of autonomy set up by the People's Republic of China. The Special Administrative ...
Trading Center