Non-Profit Business: Is The Means Worth The Ends?

Tierney Riccitelli

Dr. Marvasi

BUS 178 F

2 December 2015

Non-Profit Businesses: Is The Means Worth The Ends?

Philanthropy is the practice of giving money and time to help make life better for other people. But sometimes the efforts put into helping other people do not have high results. Non-profit businesses make up a decent part of the world’s economy. This type of business can be found in almost every country. But can this method of running a business can make one question the rationality of its design. Some people view non-profits as a waste of time because many of the problems that they deal with have existed for years and have not yet been resolved. If the money put into projects across the globe produces little to no results in certain

The examination of this notion will be through seeing what impact the United States work in other countries has within the United States; beneficial or detrimental outcomes. However, with non-profits having a source of income, should they not have to pay taxes? Even more so, if a company is receiving a tax break in the United States but is doing work outside of the county, can it be deemed unnecessary to allow them to receive tax exemptions? It would seem plausible that a company that is based in the United States and promotes the United States economy would receive tax benefits, but not ones that work outside out the country. Then through analyzing the impacts that not for profit businesses have with the work they do, the overall effects can be seen in global and local markets.

To begin analyzing the rationality of a not for profit organization, it needs to be noted that nonprofits are able to receive a profit but they must use these profits to the expenses of future work that will arise. “Note that nonprofits are not prohibited from earning profits; rather, they must simply devote any surplus to financing future services or distribute it to noncontrolling persons” (Hansmann 28). Any and all money the organization receives must be taken and put back into the

“Nonprofits that receive a substantial portion of their income in the form of donations will be referred to here as ‘donative’ nonprofits; firms whose income derives primarily or exclusively from sales of goods or services will be called ‘commercial’ nonprofits” (Hasmann 28). This information is necessary to differentiate between charities such as the Salvation Army or Good Will (commercial nonprofits), which raise a lot of money through selling used goods and the American Red Cross (donative nonprofit), which receives donations to fund its