For Profit vs Not for Profit

Grades: 
11, 12

To introduce students to the differences between businesses and nonprofit organizations and key terms used in each sector.

Lesson Rating 
0
Duration 
Print1 hour
Objectives 

Students will:

  • Compare and contrast the for profit and not for profit (civil society) sectors
  • Learn the vocabulary of 990 forms
  • Learn how an organization can receive 501 (c) (3) status    
Materials 
  • Handout: “For Profit and Not For Profit Entities” 
  • Examples of completed IRS Form 990 from nonprofit organizations (downloaded through Charity Navigator and GuideStar websites)
  • IRS Form 1023 “Application for Recognition of Exemption” and “Notice 1382 (Changes for Form 1023)”[blank form downloaded from https://www.irs.gov/pub/irs-pdf/f1023.pdf]
Vocabulary 

Nonprofit organization, Mission, Profit, 990 form, Not-for-profit, Nonprofit sector, Business sector, Private (not public), Tax exempt

Instructions

Print
  1. Presentation and discussion about the distinction between a “For Profit" (business) entity and a "Not For Profit" (or nonprofit) entity.

  2. Students review examples of completed IRS Form 990s from nonprofit organizations that illuminate the financial pictures of a nonprofit, such as expenses like program costs, assets, grants awarded (for foundations), personnel, etc. These examples are downloaded through the Charity Navigator and GuideStar websites.

  3. Students learn how a group can apply for nonprofit status from the IRS as they review IRS Form 1023 “Application for Recognition of Exemption” [blank form downloaded from http://www.irs.gov/pub/irs-pdf/f1023.pdf].

Assessment 

Class discussion reflecting students’ understanding of the material as well as class presentations on selected nonprofit agencies.

Cross Curriculum 

Read about the service-learning project called Project Dream Day by Indiana students who were taught using this Philanthropy 101 Course of The Westminster Schools unit of lessons to guide student learning and action.

Mr. Large is an Indiana teacher who believes service and philanthropy are integral parts of overall character education. "Students learn about the importance of giving and paying it forward."