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I am starting a non profit organization of which I will be the sole owner. The business is about selling books to particular groups of people at a cheaper price. I live in US, Massachusetts. What type of business entity should I choose.

Our business model does include a revenue model. Revenue comes from ads and to some extent from charging customers in order to sustain the business. We do not have any donation yet.

What entity should I choose? LLC, Corporation or something else? Does it matter at all?

I am non-US Citizen but will be one soon.

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2 Answers

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chimpanzee, I wouldn't dismiss littleadv if I were you.

But then again I'm a Harvard lawyer.

For the sake of argument, let's say you have a non-profit pursuit and a for-profit one.

In that case, you need two entities:

  1. A non-profit entity, such as a 501(c)(3) and
  2. A for-profit entity, such as an LLC.

Hire a lawyer.

You'll screw it up if you do it yourself or keep asking for free advice on here, and end up in big legal trouble.

This would be like me trying to get coders here to write code for me for free.

How do you know the answers on here aren't from Law & Order JDs?

Good luck.

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I have no problem hiring a lawyer, if they know anything. Most of them are lame as we are. But I will definitely try to find one. This does seem simple to me, start as 501(c)(3) then as business grows, start an LLC. – chimpanzee Jun 21 '12 at 19:23
up vote 1 down vote

Is it a non-profit organization or a business? Is the activity for profit, or the revenue is intended to cover the expenses? On what basis will you decide which customer to charge what?

These are questions you need to answer to yourself. Your citizenship doesn't matter as much as your residency status. If you're a non-resident there are entities you cannot own.

Non-profits should incorporate, and get a certification as non-profit. If its a for-profit business then its up to you to chose how to run it, it matters - but depends on your goals, and risks.

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As I said there is a business model. One aspect is non profit (why this business in the first place), the second aspect is for profit. Of course it will need some money to run the business so it has to generate profit. – chimpanzee Jun 21 '12 at 4:05
So the whole enterprise is for profit? Your usage of "nob-profit" and "business" in the same sentence is confusing. Non-profits are not businesses. – littleadv Jun 21 '12 at 4:24
Yes, the whole enterprise includes a profit model. I don't intend it for profit as such but well we will paying employee and we need a revenue source. – chimpanzee Jun 21 '12 at 11:44
@chimpanzee you have to get a proper counsel, really. You seem to be unaware of what "profit" means and how is it different from "revenue". – littleadv Jun 21 '12 at 17:56

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