What is the difference between a charity and a nonprofit?

A charity is a type of nonprofit with a charitable purpose and typically qualifies as a 501(c)(3). A nonprofit can have many mission types and may have a different tax classification. All charities are nonprofits, but not all nonprofits are charities.

Is a charity a nonprofit organization?

Yes. A charity is a nonprofit organization that meets specific requirements, often as a 501(c)(3), and exists to support charitable purposes such as education, research, or public benefit programs.

Are all nonprofits considered charities?

No. Some nonprofits do not qualify as charities. For example, certain membership organizations or other nonprofit types can be tax-exempt but may not meet the requirements to be classified as a charitable organization.

Are donations to nonprofits tax-deductible?

Not always. Donations are generally tax-deductible when made to a qualified charitable organization, such as a 501(c)(3). Donations to other types of nonprofits may not be tax-deductible.

Why does it matter whether an organization is a charity or a nonprofit?

It matters because charitable status can affect how the organization is regulated, how funds are used, and whether donations may be tax-deductible. Understanding the difference helps donors make more informed giving decisions.

Charity vs. nonprofit

What is the difference between a nonprofit and a charity?

One of the most important things to note when looking for charitable organizations to donate to is that while all public charities are considered nonprofits, not all nonprofit organizations are considered public charities.

What is a nonprofit organization?

A nonprofit organization:

Operates for a public or mutual benefit
Does not distribute profits to owners
May focus on education, advocacy, research, or community services

What is a charity?

A charity:

Is a type of nonprofit organization
Qualifies as a 501(c)(3) under IRS rules
Relies primarily on donations
Uses funds to support a charitable mission

Differentiating factors

Patient Josiah flexes his muscles on the St. Jude campus. — St. Jude patient **Josiah**

For what purpose does the organization exist?

There's a difference between organizations that qualify as a public charity and nonprofits that are not a public charity. According to the IRS, 501(c)(3) public charities exist for purposes that are:

religious
scientific
literary
educational
other specified purposes

Examples of nonprofits that are not usually qualifying charitable organizations:

social welfare organizations
civic leagues
social clubs
labor organizations
business leagues

How funding is handled

While both nonprofits and charity organizations can be funded by donations, grants and fundraising initiatives, charities must receive at least one-third of their funding from governmental units, from contributions made by the general public or from a combination of these sources. If less than one third, but more than 10%, is funded from these sources, the charity must pass a facts and circumstances test.

How taxes are handled

Donations to charities are usually tax deductible, while those made to nonprofits that are not public charities may not be. If you're interested in the tax benefits of donating to a charity or nonprofit, please consult a tax professional.

How to determine if an organization is a charitable organization

To find out if an organization is a public charity, you can ask the organization whether it's a qualified organization and it should be able to tell you. You can also search for charities on IRS.gov.

Is St. Jude a charity or a nonprofit?

St. Jude Children’s Research Hospital is both a recognized charity and a nonprofit organization as we meet the requirements of a Section 501(c) (3) organization of the Internal Revenue Code.

St. Jude patient Emma stands with her hands on her hips. — St. Jude patient **Emma**

Why support St. Jude?

Families never receive a bill for treatment, travel, housing or food — so they can focus on helping their child live.

When St. Jude opened in 1962, childhood cancer was considered incurable. Since then, St. Jude has helped push the overall survival rate from 20% to more than 80%, and we won't stop until no child dies from cancer.

Every child deserves a chance to live their best life and celebrate every moment. When you support St. Jude, you help give kids with cancer around the world that chance. Together, we can save more lives.