Philanthropy | Community Work

The Difference Between Public & Private NonProfit Organizations

While philanthropy plays a role of the utmost significance in society, the details of these vital organizations generally remain in the dark. While, yes, we know there is a difference between public and nonprofit organizations, we, all-too-often anyway, do not know what the difference is, what it means, and how it should affect us in distinguishing what not-for-profit we decide to contribute to.


A not-for-profit organization is a company that is founded with goals in addition to merely turning a profit. Generally, these companies are made up of well-known institutions like hospitals, schools, churches, or even labor unions among a variety of other integral establishments. The majority of these organizations have tax exemption from the federal government, so long as they are able to prove they exist for the purpose of philanthropy, worship, public service, science, schooling, development of sports, or the prevention of cruelty in regards to either animals or children.

Public Non-Profits

These fantastic companies gain the vast majority of their capital from donations or contributions from the general public. Occasionally, these establishments will hold fundraisers where they are able to rely on the goodwill of the community to support them. Museums are also largely included in the public non-profit umbrella, but rather than hold small fundraisers, they often receive donations through paid memberships that offer some sort of perks package or another.

Private Non-Profits

These sort of organizations tend to rely on the on the contributions of a select few resources. This sort of financial backing can be attributed to either a private donor or lucrative investment income. While a private donor in this scenario may be looked upon as a sort of angel investor, the fact is that generally these private donors are the same ones who found the organization in the first place. This, however, does not prohibit the possibility of attaining capital through additional wealthy or well-off, well-meaning individuals.


It should be noted that is not at all uncommon for a not-for-profit organization to accept goods in addition to monetary donations. Just as well, it should be mentioned that all nationally acknowledged nonprofits do not have to pay out Social Security taxes. However, some not-for-profit companies choose to pay, anyway.