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Michael Williams

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Why do we allow Non-Profits to Profit?

Why do we allow Non-Profits / charities to Profit? What is the incentive to ever achieve a non-profit's/charities goal?

The American cancer society, has been a charity for around 100 years, has made around 1 billion in donations in 2012 alone, and a CEO makes 2.5 million as a salary, with such a track record, why would a company want to find a cure when that would end their funding and therefor salary.

This is only one of many charities and non profits, how can such a practice go unregulated and even applauded?


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    Jun 16 2013: Michael, An NPO is an organization that uses surplus revenues to achieve its goals rather than distributing them as profit or dividends. States in the United States defer to the IRS designation conferred under United States Internal Revenue Code Section 501(c), when the IRS deems an organization eligible. The IRS looks at the org and asks did you declare a profit or pay dividends? No well your good. There is no moral or ethical question ... lawyers are such a wonderful thing to have. Take all of the profit and devise a plan for the future and say that the 20 billion is for more centers in other places ... later. Or we plan to expand and will hire 200 more executives at $500, 000 a year to plan for the future ... but we did not pay dividends. We are proud to say that we spend 23 cents per dollar on the cause and three kids were helped just this month.

    The letter of the law has been met .... the heck with the intent. The IRS has been a target since its inception during the civil war. It is very much in the news today and adding this to the fire will not be appreciated. The IRS is under the Treasury but they have distanced themselves and say the IRS Director is the ultimate power. Good ole Washington two step. No one in Washington knew anything ... the dog just went rabid .... IRS needs looked at .... not me / us.

    Every govt agency guards the rice bowl with fierce micro management, whistle blowing, backstabing, and going to war for a position. Dirty little secrets are power in DC. Plausible deniability is a lawyer term for "kill the messenger".

    The problem is the 501 (c) is also the code that covers political PACTS and contributions, etc (a wide range) so it is a sacred cow. To make charities clean up you would also have to make politicians clean up ... LOL good luck with that.


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