It is certainly possible to develop an enterprise as a 501(c)3 entity (often referred to as "not-for-profit" or "charitable organization"). This designation is determined by the Internal Revenue Service (IRS) through a detailed application process. None of the organization’s earnings may be paid to a private shareholder or individual as “earnings.” Certainly such an organization may hire and pay employees.
It is necessary that a 501(c)3 be for "charitable, religious, educational, scientific, literary, testing for public safety, fostering national or international amateur sports competition, and the prevention of cruelty to children or animals." As such, the organization cannot attempt to influence legislation, nor may it participate in political campaigns.
For more information, go to the IRS Web site at Tax Information for Charities & Other Non-Profits.
