The commerciality doctrine was created to address concerns over not-for-profits competing at an unfair tax advantage with for-profit businesses. Organizations that don’t pass muster could lose their tax-exempt status. Even business activities related to your nonprofit’s exempt purpose could fall prey to the doctrine. Courts consider several factors, including whether you sell to the general public, set prices to maximize profits and accumulate unreasonable reserves. Contact us before launching a revenue-generating business.

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