section 501(c)(3) organization business definition

An entity, often described as a charitable organization, that is organized and operated exclusively for purposes set forth in section 501(c)(3) of the IRS Code. These organizations may not participate in campaign activities for or against political candidates, may not attempt to influence legislation, and none of their earnings can accrue to a private shareholder or individual. Meeting these standards allows the organizations to obtain federal tax-exempt status and to receive tax-deductible contributions.