Differences Between Nonprofit and Not-for-Profit Organizations

Nonprofit vs. Not-for-Profit

Introduction

The words “nonprofit” and “not-for-profit” might look similar, but they have different meanings. Let’s explore what these words mean, how they came to be, and how to use them in simple ways.

History

Both words have been used for a long time. “Nonprofit” became common in the early 20th century. It usually means an organization that helps others instead of making money. “Not-for-profit” is also from around the same time, and it means things not made to make money, but can be smaller than nonprofit groups.

How to Use Them

Nonprofit

• Nonprofit organizations help people without making money.
• A lot of schools are nonprofit.
• Charities are often nonprofit.
• A nonprofit does not give its money to owners.
• Nonprofit groups focus on causes, like helping animals or children.

Not-for-Profit

• A not-for-profit hobby club is about fun, not making money.
• The local sports team is not-for-profit.
• Not-for-profit groups can use any extra money for their goals.
• Mary’s sewing group is a not-for-profit club.
• Not-for-profit organizations often rely on volunteers.

Trick to Remember the Difference

Think of “nonprofit” as big groups like charities and schools. “Not-for-profit” can be smaller, like clubs or teams.

Summary

Use “nonprofit” when talking about large groups that help without making money, like charities and schools. Use “not-for-profit” for smaller, informal groups like clubs or hobby groups. Both aim not to earn money for personal gain but for their activities and programs.