Types Of 501c3
When looking at types of 501 c 3, there are three main categories. The types of 501 c 3 are private foundations, private operating foundations, and public charities. In order to be considered a 501 c 3 organization, the group must operate solely for the purpose of religious, charitable, literary, scientific, or educational purposes, or to help conduct public safety testing, or to help national or international sports competition, or to prevent cruelty to children and/or animals. Any organization operating for those purposes can apply to be covered under one of the types of 501 c 3.
The first type of 501 c 3 is private foundations. Private foundations have a small group of donors. Donors to this type of 501 c 3 can be individuals, a family, or a business. This type of 501 c 3 uses money from endowment funds to fund grants for other organizations. This type of 501 c 3 is also called a ‘non-operating foundation’ because they do not normally have any programs of their own active. Examples of this type of 501 c 3 are the Bill and Melinda Gates Foundation and the Carnegie Corporation.
The second of the types of 501 c 3 is private operating foundations. These foundations finance their own programs. Some common programs for this type of 501 c 3 are helping low income families, researching cures for diseases, and sometimes the day-to-day operations of libraries and museums. This type of 501 c 3 is the least common type. In a way, private operating foundations are a hybrid. It takes parts of the other two types of 501 c 3 and includes them into how it functions. They can have a close governing body like a private foundation, but they can also receive donations from the general public, like public charities. One requirement of this type of 501 c 3 is that most of the earnings must be used to conduct the organizations programs. An example of this type of 501 c 3 is the J. Paul Getty Trust.
The third, and final, type of 501 c 3 is public charities. These are probably the most commonly known of the types of 501 c 3. Money for these types of 501 c 3 are donated from the general public or given to them by the government. They must, however, have 1/3 of their donations from the public to keep their status as a public charity. This type of 501 c 3 is typically run by a governing body made of unrelated people, unlike private foundations and private operating foundations. Examples of this type of 501 c 3 are schools, churches, and hospitals. Some more recognizable examples of this type of 501 c 3 are the United Way and the Special Olympics.
There are three types of 501 c 3. They are private foundations (which are often operated by a family), private operating foundations (which can be run by a family, but can also be funded by the public), and public charities (which are primarily funded by the general public with some help from businesses and the government). Each of these types of 501 c 3 are there to support the public in different ways.
