What must a nonprofit do with its excess revenue?

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1188266

2026-03-18 07:46

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A nonprofit must reinvest its excess revenue back into its mission and programs to further its charitable goals. This can include expanding existing services, launching new initiatives, or improving operational capacity. Nonprofits are prohibited from distributing excess revenue as profits to individuals or shareholders, ensuring that resources are used to benefit the community they serve. Additionally, maintaining a reserve for future needs or unforeseen circumstances is also a prudent practice.

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