Not-for-profit organizations must meet specific guidelines in order to obtain tax-exempt status. These guidelines are structured by the Internal Revenue Service.
Under one of the 25 subsections of Internal Revenue Code Section 501(c), the majority of nonprofit organizations are eligible for a federal income tax exemption.
A nonprofit organization (NPO) is one that is not motivated by profit but rather by commitment to a particular cause that receives all funds received over and beyond what is required to maintain the organization.
NPOs are granted tax-exempt status by the federal government as a result, which exempts them from paying income tax. Trusts, cooperatives, advocacy, charity, environmental, and religious groups frequently use nonprofit entities.
Hence, Internal Revenue Service is the answer.
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