What Are Non-Profits—and Why Are Credit Unions Included?
A non-profit organization is structured to serve a specific mission rather than generate profits for owners or shareholders. Any money earned beyond operating costs is reinvested into the organization’s services, community programs, or resources that align with its purpose. Common examples include charities, educational institutions, and credit unions.
The Origins and Purpose of Non-Profits
Non-profits have been around for centuries, often founded to address social needs not met by governments or for-profit businesses. In the U.S., they’re granted tax-exempt status under Section 501(c) of the Internal Revenue Code, provided they meet specific requirements. This status allows them to focus their resources on their mission rather than on generating profits for private gain.
How Non-Profits Are Regulated
Non-profits are overseen by both state and federal regulations. They must adhere to strict reporting requirements, including transparency in financial operations and governance. For tax-exempt organizations, the IRS requires annual filings (like Form 990) to ensure funds are being used appropriately. State-level regulators often impose additional rules around board governance, fundraising, and audits.
Why Credit Unions Are Non-Profits
Credit unions are member-owned financial cooperatives. Unlike banks, which aim to generate profits for shareholders, credit unions return any surplus to their members through better rates, lower fees, and improved services. They’re regulated by the National Credit Union Administration (NCUA) and, like other non-profits, must reinvest earnings to benefit their members directly.
Freedom Credit Union’s Role as a Non-Profit
As a non-profit, Freedom Credit Union operates with a clear mission: to serve the financial needs of its members in Utah County. Any income generated goes back into improving services, offering competitive rates, and supporting financial education initiatives. Our non-profit status ensures that decisions are made with the best interests of our members—not external shareholders—in mind.
In essence, being a non-profit allows Freedom Credit Union to stay focused on what matters most: providing fair, accessible financial services to our community.
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