Nonprofit Organizations Selling Products
A 501c3 can sell products related to its mission to fund nonprofit programs and benefit the organization.
Generating Income for Nonprofits
Nonprofits can engage in income-generating activities by selling merchandise or setting up hybrid relationships with for-profit entities.
Unrelated Business Income Tax
Income-generating activities unrelated to a nonprofit’s exempt purposes may be subject to unrelated business income tax at the corporate tax rate.
Some non-profits run social enterprises, selling products or services to support their mission.
Pricing and Selling Products
Nonprofit merchandise sales pricing should aim for a profit margin of approximately 30-50% per item.
Nonprofits can sell products online on platforms like Etsy for tax-deductible organizations.
Amazon for Nonprofits
Nonprofits can sell products on Amazon without needing a business license. AmazonSmile donates 0.5% of eligible purchases to a chosen charity.
Amazon offers nonprofit-exclusive pricing and donation programs, such as the AmazonSmile Foundation.
Selling Wholesale Products on Amazon
Selling wholesale products on Amazon may require a business license and sales tax permit from brands, wholesalers, or distributors.