Qualified Charitable Organization

Posted in Finance, Accounting and Economics Terms, Total Reads: 300
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Definition: Qualified Charitable Organization

Qualified Charitable Organizations are Non-profit Organizations that are given tax-exempt status by US Treasury. These organizations must be operated for public charity and social well-being activities. Any entity can be qualified as Charitable Organizations if that entity is involved in public charity.


Local governments, state governments, cemetery and burial companies can be qualified as Charitable Organizations. Any donations that are made to these Charitable Organizations are tax-deductible.


In the US, under section 501(c) (3) of internal revenue code, qualified charitable organizations are exempted from federal income tax and they are also eligible for tax deductible charitable contributions.

 

Here it is required to differentiate between qualified charitable organization and tax-exempt organization. Tax-exempt organization may not have charitable purposes and contribution made to this organization is not tax deductible.

 

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