Non-Profits: Top to Bottom

Non-Profits

Share this infographic on your site!

Non-Profits: Top to Bottom

In 2013 alone, 335 billion dollars were given to 1.6 million charities. That’s enough money to fund the Department of Education for over 4 1/2 years. [DOE’s budget in 2013 was 71.9 billion]

Contribution Breakdown for 2013 in Billions

  • Individuals ($240.60) 72%
  • Foundations ($48.96) 15%
  • Bequests ($27.73) 8%
  • Corporations ($17.88) 5%
  • TOTAL ($335.17) 100%

With an ever-growing number of shady non-profits competing for your donations, it’s worth knowing just how a 501(c)(3) should and shouldn’t spend your money.

What is a non-profit organization?

According to the IRS, a tax-exempt 501(c)(3) organization must…

  • have a charitable purpose.

    • Examples include: relief of the poor, the distressed, or the underprivileged; advancement of religion; advancement of education or science; erecting or maintaining public buildings, monuments, or works; lessening the burdens of government; lessening neighborhood tensions; eliminating prejudice and discrimination; defending human and civil rights secured by law; combating community deterioration and juvenile delinquency; testing for public safety; fostering national or international amateur sports competition; preventing cruelty to children or animals.
  • not benefit private interests.

    • It may not benefit the non-profit’s creator or the creator’s family, or shareholders.
    • No part of the net earnings may benefit any person having a personal and private interest in the activities of the organization.
  • tread lightly in politics.

    • It may not attempt to influence legislation as a substantial part of its activities.
    • It may not participate in any campaign activity for or against political candidates.

True or False:

It is bad for a non-profit to make a profit?

FALSE!

A common misconception about non-profits is that they shouldn’t make profits. But a good non-profit needs to be sustainable, which involves making profits and even investing money. The difference is that the profits go to benefit the organization, not the owners or shareholders.

  • Non-profit Business: Uses profits to advance their programs.
  • For-profit Business: Distributes profits to their owners or stockholders.

10 Most Profitable Non-Profits

The top ten profitable non-profit organizations are actually spending money in efficient and effective ways.

1. Goodwill Industries International

  • Summarized Purpose: Working to enhance the dignity and quality of life of people.
  • Total Profit: $361,996,546
  • Total Revenue: $4,894,712,975
    • Revenue from the public: 19.4% ($948,665,266)
    • Revenue from the government: 9.7% ($477,044,455)
    • Revenue from investments and programs: 70.9% ($3,469,003,254)
  • Total Expenses: $4,532,716,429
    • Expenses on Programs: 88% ($3,989,709,985)
    • Expenses on Administration: 11.4% ($518,242,480)
    • Expenses on Fundraising: 0.6% ($24,763,964)

 2. The YMCA

  • Summarized Purpose: Putting Christian principles into practice through programs.
  • Total Profit: $310,788,000
  • Total Revenue: $6,239,518,000
    • Revenue from the public: 13.3% ($827,183,000)
    • Revenue from the government: 9.8% ($614,190,000)
    • Revenue from investments and programs: 76.9% ($4,798,145,000)
  • Total Expenses: $5,928,730,000
    • Expenses on Programs: 84.8% ($5,026,839,000)
    • Expenses on Administration: 13.1% ($778,580,000)
    • Expenses on Fundraising: 2.1% ($123,311,000)

 3. The Nature Conservancy

  • Summarized Purpose: Conserving the lands and waters on which all life depends.
  • Total Profit: $192,725,492
  • Total Revenue: $949,132,306
    • Revenue from the public: 56.4% ($535,923,725)
    • Revenue from the government: 15.8% ($149,744,370)
    • Revenue from investments and programs: 27.8% ($263,464,211)
  • Total Expenses: $756,406,814
    • Expenses on Programs: 73.9% ($558,787,835)
    • Expenses on Administration: 15.1% ($114,270,650)
    • Expenses on Fundraising: 11% ($83,348,329)

4. Boy Scouts of America

  • Summarized Purpose: Providing a program for young people that builds character.
  • Total Profit: $175,349,000
  • Total Revenue: $1,062,968,000
    • Revenue from the public: 33.7% ($358,240,000)
    • Revenue from the government: 0.5% ($5,746,000)
    • Revenue from investments and programs: 65.8% ($698,982,000)
  • Total Expenses: $887,619,000
    • Expenses on Programs: 87% ($771,836,000)
    • Expenses on Administration: 8% ($71,078,000)
    • Expenses on Fundraising: 5% ($44,705,000)

5. Cystic Fibrosis Foundation

  • Summarized Purpose: Attacking cystic fibrosis from every angle.
  • Total Profit: $175,180,968
  • Total Revenue: $341,343,541
    • Revenue from the public: 39.3% ($134,090,038)
    • Revenue from the government: 0% ($0)
    • Revenue from investments and programs: 60.7% ($207,253,503)
  • Total Expenses: $166,162,573
    • Expenses on Programs: 83.9% ($139,481,518)
    • Expenses on Administration: 6.4% ($10,588,156)
    • Expenses on Fundraising: 9.7% ($16,092,899)

6. Smithsonian Institution

  • Summarized Purpose: Shaping the future by preserving, discovering, and sharing.
  • Total Profit: $168,546,753
  • Total Revenue: $1,315,239,542
    • Revenue from the public: 15.1% ($199,257,103)
    • Revenue from the government: 69.7% ($916,403,979)
    • Revenue from investments and programs: 15.2% ($199,578,460)
  • Total Expenses: $1,146,692,789
    • Expenses on Programs: 78.1% ($895,673,594)
    • Expenses on Administration: 18.4% ($211,382,420)
    • Expenses on Fundraising: 3.5% ($39,636,775)

7. ALSAC/St. Jude Children’s Research Hospital

  • Summarized Purpose: Advancing cures and prevention for pediatric diseases.
  • Total Profit: $166,836,242
  • Total Revenue: $870,140,691
    • Revenue from the public: 89.2% ($776,484,977)
    • Revenue from the government: 0% ($0)
    • Revenue from investments and programs: 10.8% ($93,655,714)
  • Total Expenses: $703,304,449
    • Expenses on Programs: 71.9% ($505,987,395)
    • Expenses on Administration: 8.3% ($58,297,844)
    • Expenses on Fundraising: 19.8% ($139,019,210)

8. New York Public Library

  • Summarized Purpose: Inspiring lifelong learning and strengthening our communities.
  • Total Profit: $121,237,774
  • Total Revenue: $394,990,723
    • Revenue from the public: 19.6% ($77,619,561)
    • Revenue from the government: 41.5% ($163,797,431)
    • Revenue from investments and programs: 38.9% ($153,573,731)
  • Total Expenses: $273,752,949
    • Expenses on Programs: 85.4% ($233,771,067)
    • Expenses on Administration: 11.7% ($31,932,526)
    • Expenses on Fundraising: 2.9% ($8,049,356)

9. Step Up for Students

  • Summarized Purpose: Alleviating the educational issues faced by kids in Florida who are living in poverty.
  • Total Profit: $115,141,222
  • Total Revenue: $267,783,788
    • Revenue from the public: 99.9% ($267,447,702)
    • Revenue from the government: 0% ($0)
    • Revenue from investments and programs: 0.1% ($336,086)
  • Total Expenses: $152,642,566
    • Expenses on Programs: 98.4% ($150,286,359)
    • Expenses on Administration: 0.8% ($1,168,829)
    • Expenses on Fundraising: 0.8% ($1,187,378)

10. Boys & Girls Clubs of America

  • Summarized Purpose: Promoting and enhancing the development of boys and girls.
  • Total Profit: $106,723,534
  • Total Revenue: $1,572,511,548
    • Revenue from the public: 44.5% ($699,384,431)
    • Revenue from the government: 31.2% ($490,836,802)
    • Revenue from investments and programs: 24.3% ($382,290,315)
  • Total Expenses: $1,465,788,014
    • Expenses on Programs: 81.6% ($1,195,960,183)
    • Expenses on Administration: 12.4% ($181,831,746)
    • Expenses on Fundraising: 6% ($87,996,085)

5 Red Flags of Shady Non-profits

Donors become wise social investors by learning how to identify and avoid shady nonprofits. Look for these red flags before you donate your hard earned money.

1. Wrong Fiscal Focus

Look out for charities that spend the vast majority of its money on administrative and fundraising expenses rather than programs.

  • The Better Business Bureau reports that non-profits should designate at least 65% of their funds to programming costs and no more than 35% of funds to fund raising and administration.

2. Negative Profit

Negative profit indicates that the organization has poor performance compared to industry standards. If this is an ongoing trend, the non-profit could go under taking your money with it.

  • Thirty-three out of the top 100 non-profits in 2012 had negative profits at the end of the year.

3. Pending Lawsuits/Under Investigation

If the IRS or another organization is suspicious of the actions of the organization, it is best not to trust your money with them. Not only could they have questionable practices, but they might lose their 501(c)(3) status and you could lose your tax break.

4. CEO/ED Power

The board is supposed to be in charge of the charity, not the CEO or Executive Director. Too much power with the CEO/ED could cause suspicion for benefiting private interests.

5. Excessive Pressure

Avoid non-profits that apply too much pressure for you to give immediately. This is particularly true if you get a phone call from a fundraiser. They should be willing to operate on your time table.

10 Shady Non-profits

These are just a few of the hundreds of non-profits with seemingly important missions that spend very little money on the programs they pledged to provide.

Typically their names are intended to pull on heart strings, they spend most of their money on fundraising, and they get most of their money from the public not through the program itself, investments, or the government.

10. The Committee for Missing Children

  • Summarized Purpose: Helping find missing children.
  • Total Profit: -$48,414
  • Total Revenue: $2,036,260
    • Revenue from the public: 99.7% ($2,031,138)
    • Revenue from the government: 0% ($0)
    • Revenue from investments and programs: 0.3% ($5,122)
  • Total Expenses: $2,084,674
    • Expenses on Programs: 12.1% ($252,405)
    • Expenses on Administration: 2.4% ($49,444)
    • Expenses on Fundraising: 85.5% ($1,782,825)

9. National Vietnam Veterans Foundation

  • Summarized Purpose: Veterans helping veterans.
  • Total Profit: $29,159
  • Total Revenue: $4,895,211
    • Revenue from the public: 100% ($4,895,198)
    • Revenue from the government: 0% ($0)
    • Revenue from investments and programs: 0% ($13)
  • Total Expenses: $4,866,052
    • Expenses on Programs: 11.5% ($559,853)
    • Expenses on Administration: 1.6% ($77,830)
    • Expenses on Fundraising: 86.9% ($4,228,369)

8. Autism Spectrum Disorder Foundation

  • Summarized Purpose: Supporting children with an autism spectrum disorder.
  • Total Profit: -$7,609
  • Total Revenue: $3,847,816
    • Revenue from the public: 100% ($3,847,815)
    • Revenue from the government: 0% ($0)
    • Revenue from investments and programs: 0% ($1)
  • Total Expenses: $3,855,425
    • Expenses on Programs: 9.6% ($368,724)
    • Expenses on Administration: 1.3% ($49,468)
    • Expenses on Fundraising: 89.1% ($3,437,233)

7. California Police Youth Charities

  • Summarized Purpose: Cops for Kids.
  • Total Profit: -$65,785
  • Total Revenue: $2,372,045
    • Revenue from the public: 100% ($2,372,045)
    • Revenue from the government: 0% ($0)
    • Revenue from investments and programs: 0% ($0)
  • Total Expenses: $2,437,830
    • Expenses on Programs: 9.3% ($225,478)
    • Expenses on Administration: 6.1% ($149,325)
    • Expenses on Fundraising: 84.6% ($2,063,027)

6. Wishing Well Foundation USA

  • Summarized Purpose: Making the wishes of terminally ill children come true.
  • Total Profit: $18,184
  • Total Revenue: $1,152,212
    • Revenue from the public: 100% ($1,152,212)
    • Revenue from the government: 0% ($0)
    • Revenue from investments and programs: 0% ($0)
  • Total Expenses: $1,134,028
    • Expenses on Programs: 8.2% ($93,445)
    • Expenses on Administration: 9.3% ($105,431)
    • Expenses on Fundraising: 82.5% ($935,152)

5. Cancer Survivors’ Fund

  • Summarized Purpose: Helping cancer survivors move from surviving to thriving.
  • Total Profit: -$10,228
  • Total Revenue: $1,136,260
    • Revenue from the public: 100% ($1,136,260)
    • Revenue from the government: 0% ($0)
    • Revenue from investments and programs: 0% ($0)
  • Total Expenses: $1,146,488
    • Expenses on Programs: 7.5% ($85,733)
    • Expenses on Administration: 2.5% ($28,584)
    • Expenses on Fundraising: 90% ($1,032,171)

4. Firefighters Charitable Foundation

  • Summarized Purpose: Helping victims of fire and disaster.
  • Total Profit: -$7,521
  • Total Revenue: $7,600,411
    • Revenue from the public: 99.7% ($7,578,339)
    • Revenue from the government: 0% ($0)
    • Revenue from investments and programs: 0.3% ($22,072)
  • Total Expenses: $7,607,932
    • Expenses on Programs: 7% ($533,711)
    • Expenses on Administration: 5.2% ($395,768)
    • Expenses on Fundraising: 87.8% ($6,678,453)

3. United States Deputy Sheriff’s Association

  • Summarized Purpose: Serving the needs of county law enforcement nationwide.
  • Total Profit: $13,062
  • Total Revenue: $2,563,008
    • Revenue from the public: 100% ($2,563,007)
    • Revenue from the government: 0% ($0)
    • Revenue from investments and programs: 0% ($1)
  • Total Expenses: $2,549,946
    • Expenses on Programs: 6.6% ($168,702)
    • Expenses on Administration: 5% ($126,762)
    • Expenses on Fundraising: 88.4% ($2,254,482)

2. Faith’s Hope Foundation

  • Summarized Purpose: Helping families pay hospital expenses.
  • Total Profit: -$7,917
  • Total Revenue: $3,515,679
    • Revenue from the public: 100% ($3,515,679)
    • Revenue from the government: 0% ($0)
    • Revenue from investments and programs: 0% ($0)
  • Total Expenses: $3,523,596
    • Expenses on Programs: 4.5% ($157,533)
    • Expenses on Administration: 1.2% ($44,282)
    • Expenses on Fundraising: 94.3% ($3,321,781)

1. Walker Cancer Research Institute

  • Summarized Purpose: Working to find more effective treatments for cancer.
  • Total Profit: $500,430
  • Total Revenue: $10,761,022
    • Revenue from the public: 95.7% ($10,297,619)
    • Revenue from the government: 0% ($0)
    • Revenue from investments and programs: 4.3% ($463,403)
  • Total Expenses: $10,260,592
    • Expenses on Programs: 3.6% ($373,055)
    • Expenses on Administration: 5.3% ($542,765)
    • Expenses on Fundraising: 91.1% ($9,344,772)

 

Non-ProfitsThumb

Sources: