Difference Between Similar Terms and Objects

Differences Between Nonprofit and Not For Profit

Nonprofit vs Not For Profit

Nonprofit and not for profit – Both of these words represent the same meaning when they stand alone. However, “nonprofit” and “not for profit” are often associated with different terms; hence they are used in special cases. It’s like selecting the more appropriate term to use in a particular statement.

The term “nonprofit” is usually associated with large, legal entities which can either be socially or politically inclined. A nonprofit is more organized and is often represented by any of its staff from its charter or governing body. In big countries, like the United States, a nonprofit can have the privilege of a tax-exempt status. On the other hand, a not for profit is usually associated with a smaller group which is generally focused on human interest areas like a hobby or any particular sport. Considering this, a not for profit can’t have the privilege of a tax-exempt status.

We often think how a nonprofit and not-for-profit organizations usually work. If they don’t gain any money from their free services, how do they benefit from it? Not all people are money-driven. Some are also service-driven. A nonprofit and a not-for-profit organization are also able to make money through sponsorships and donations from several groups. They only become a nonprofit and a not-for-profit since they don’t use the money for their personal gain. But to be able to keep the organization alive and kicking, they have to use the profits they earn so as to continue their mission of giving free service to the people. The nonprofit and not-for-profit establishments are composed of volunteers.

Since the meanings of “nonprofit” and “not for profit” may vary in several countries, generally, these are the conditions to distinguish both types from a for-profit organization. A nonprofit organization may literally mean that the organization is not gaining any profit at all. On the other hand, a not-for-profit organization may mean that the money they acquire doesn’t go directly to benefit them.

A nonprofit organization must meet the following conditions: It belongs to a charter; is built and organized with a mission of serving the community, or helping the community to make it a better place. And lastly, a nonprofit organization doesn’t deal with paying of dividends among stockholders. Meanwhile, a not-for-profit organization only fits within the following criteria: It is involved in smaller groups and revolves around a particular hobby or recreational activity; doesn’t have charters or a governing board; must not have the intentions of earning money.


  1. The terms “nonprofit” and “not for profit” may be used interchangeably when they stand alone.

  2. The term “nonprofit” is often associated with large groups or organizations under a governing board or charter. A nonprofit organization is usually inclined to focus upon political or social activities.

  3. The term “not for profit” is often associated with smaller groups or organizations which are not under a governing board or charter. A not-for-profit organization usually revolves around a particular hobby or any other form of recreational activity.

  4. In the United States, a nonprofit organization may gain the privilege of a tax-exempt status while the not-for-profit organization may not.

  5. A nonprofit organization is built or organized in order to offer free services to the community. Nonprofit organizations usually have the mission to make the community a better place. It must be built without the intention of gaining money.

  6. Both nonprofit and not-for-profit organizations don’t pay dividends to any stockholders.

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