A nonprofit organization (NPO, also known as a non-business entity) is an organization whose purposes are other than making a profit. A nonprofit organization is often dedicated to furthering a particular social cause or advocating for a particular point of view. In economic terms, a nonprofit organization uses its surplus revenues to further achieve its purpose or mission, rather than distributing its surplus income to the organization's shareholders (or equivalents) as profit or dividends. This is known as the distribution constraint. The decision to adopt a nonprofit legal structure is one that will often have taxation implications, particularly where the nonprofit seeks income tax exemption, charitable status and so on.
What does a non-profit do with the money it takes in, instead of using it for a profit?
further achieve its purpose or mission, rather than distributing its surplus income to the organization's shareholders (or equivalents) as profit