Without knowing, it beforehand, it can be very hard for a person to determine if a business is for profit, or if they are categorized as non-profit organizations. Hernando Beach residents be under the impression that any business or organization has to pay taxes if they want to be operational, but this is not the case with non-profit organizations. Event though by law a non-profit organization does not have to pay taxes if they meet all the necessary requirements, they may still have to pay taxes on any activated that are unrelated to their original purpose.

What are Non-Profit Organization Except From?

If a company can prove that they are a non-profit organization and are following the law as stipulated by the IRS, then a company can be exempt from paying sales taxes and property taxes. When it comes to non-profit organizations, Hernando Beach residents might be confused on the fact that they have to pay their employees like a for-profit company, think that this is a sign that an organization is for-profit, but this is not true. Non-profit organizations still have to pay employee taxes such as Social Security and Medicare, even if they do not have to pay property or sales tax.

When is a Non-Profit Required to Pay Their Share of Taxes?

A non-profit organization is only required to pay their fair share of taxes in certain instances. For example, it is completely possible that a company engages in activities that are not considered normal for non-profit organizations. Hernando Beach residents would not normally see a homeless shelter renting out places to stay, and if they did it for money, they would have to tax that income, and report it to the IRS in order to not face financial scrutiny.

*Disclaimer: The views expressed here are those of the authors and do not necessarily represent or reflect the views of Suncoast CPA Group*