The American nonprofit and philanthropic community plays a crucial role in lives across the country and around the world. There are more than 1.9 million tax-exempt organizations in the United States, a number that has approximately doubled in the last 30 years.

The majority of them –- about 1.5 million –- make up the “independent sector.” It includes 501(c)(3)s (public charities, private foundations, and religious congregations) and 501(c)(4)s (social welfare/advocacy organizations).¹ Together these organizations, sometimes referred to as the independent sector to emphasize their unique role in society, distinct from government and business.

• There are approximately 1.4 million 501(c)(3) organizations, including hospitals, museums, private schools, religious congregations, orchestras, public television and radio stations, soup kitchens, and foundations. Whereas other types of nonprofit organizations benefit the private, social, or economic interests of their members, 501(c)(3) organizations must benefit the broad public interest. In recognition of this service, Congress has provided that contributions made to 501(c)(3) nonprofits are tax-deductible.
• There are nearly 140,000 501(c)(4) organizations. This includes organizations such as the NAACP, the National Rifle Association, and the Sierra Club. Contributions to 501(c)(4) nonprofits are not tax-deductible, and 501(c)(4) organizations have more latitude to participate in legislative lobbying, advocacy, and political campaign activities.
• While the number of 501(c)(3) organizations has grown steadily over the last 10 years, the number of 501(c)(4) organizations has fallen nearly five percent since 1997.

What is most impressive about America’s charitable community is the variety of programs it offers. The 501(c)(3) organizations in this network fall into eight major categories:²

• Arts, culture, and humanities, such as museums, symphonies and orchestras, and community theatres;
• Education and research, such as private colleges and universities, independent elementary and secondary schools, and noncommercial research institutions;
• Environmental and animals, such as zoos, bird sanctuaries, wildlife organizations, and land protection groups;
• Health services, such as hospitals, public clinics, and nursing facilities;
• Human services, such as housing and shelter, organizers of sport and recreation programs, and youth programs;
• International and foreign affairs, such as overseas relief and development assistance;
• Public and societal benefit, such as private and community foundations, civil rights organizations, civic, social, and fraternal organizations; and
• Religion, such as houses of worship and their related auxiliary services.

Very small organizations (those with less than $5,000 in annual revenues) are not required to register with the IRS and, if counted, would increase the number of nonprofits even further.

From 1998 to 2008, the number of charitable organizations registering with the IRS has grown by 73 percent.

Footnotes 

¹This number is the sum of the number of organizations registered with the IRS and an estimation of the number of  religious congregations that are not required to file with the IRS.

²NTEE Classification System.” National Center for Charitable Statistics,  http://nccsdataweb.urban.org/PubApps/nteeSearch.php?gQry=allMajor&codeType=NTEE