Types of Christian Nonprofit Organizations: Profit for People

The IRS gives organizations the opportunity to apply and be designated as a 501C3.  A 501C3 is a tax classification.  It means the organization does not have to pay income tax on donation income.  A 501C3 organization solicits donations to earn enough income to operate the nonprofit and invest money in serving people.

They do want to profit, but they profit for the sake of the people that they serve.  Their profit does not go back into the hands of stakeholders.  When an organization forms they can designate the nonprofit as a Christian nonprofit.  This is beneficial when the organization plans on hiring staff based on their status as a Christian.

There are many terms that Christian nonprofits use to describe themselves.  Below are a list of those terms and a brief description of the differences.  The description is based on my observation of working for and with various nonprofit boards, and as a staff member.

  1. Faith Based.  This term may mean different things.  It can signify that the nonprofit is based on a specific denomination,  or faith.  It may refer to a larger spectrum of Christianity like the evangelical or protestant faith and can include many denominations.  It may just mean that the people who founded the organization were Christians and started the organization out of their Christian faith.
  2. Christian Nonprofit.  This is often similar to a faith based nonprofit.  It may mean that Christians are on the board, serve on the staff, or were founders.  It does not necessarily signify that people the organization serves are taught the Bible, evangelized or prayed with.  It may just mean some Christians came together and want to help people in some way.  How they help them may not have anything to do with the Bible, or Christian ceremony.
  3. Compassion Ministry.  We can call anything a ministry.  If you want to know what they mean by ministry you really have to ask.  A compassion ministry is often a soup kitchen, food pantry, homeless shelter or clothes ministry.  It’s a ministry that primarily seeks to meet a physical need.  Some of these ministries incorporate using God’s Word to disciple people and some don’t.
  4. Christ or Bible Centered.  These ministries are often more intentional about evangelizing and using God’s Word to disciple the people they serve.  Their focus is on sharing Christ in Word.  They follow Biblical principles for operating the organization and serving the people.

I think it is important for people to know about the ministries they support.  I was involved in all these types of ministries and they all did great things.  I am on the board of directors for a faith based organization.  When it started it was basically a group of Christians who wanted to help people have healthy marriages.  They won a government grant that funded the organization for many years, and that grant told them that they could not do or say anything that had to do with God or the Bible.  The faith part then was limited to the people on the board.

I am a founder of a 501C3 that provides mentoring for children in the school.  This organization was founded by a group of Christians, but our goal was to provide a support network to the school.  We wanted to get people out of the pew and into the school providing any support they needed.  We didn’t consider ourselves any of the above.  We were just a nonprofit.

I led what I would call a Christian, Christ and Bible centered para church ministry.  The ministry was founded by Christians, and staffed by Christians.  As part of our hiring process we asked potential volunteer and staff members for their testimony.  Not all Christian or Faith Based nonprofits do this.  They may call themselves a Christian organization but let anyone volunteer.

The organization I was on staff at sought to evangelize, and disciple clients and provided Biblical counseling.  We used God’s Word, and prayed with clients.  We also provided a compassion ministry and gave women clothes and diapers for their baby.

One is not better than the other.  God calls His people to serve the world in many different ways.  I believe it’s important to have a good understanding of organizations if we are going to financially support them.  There are many God glorifying organizations, and there are a few that aren’t what they appear to be.  I have seen those too.

If you have never been involved in a community nonprofit I would highly recommend it.  They are on the front lines, and have access to hurting and lost people.  People that we have been called to disciple.

For His Glory,

Marcy Pedersen


1 Comment

  1. Thank you for your post. I work for a Christian Nonprofit organization in India IIDA (http://iida-india.org/) that provides vocational skills to the under-privileged. We may not teach the bible to our students who come from different religious backgrounds, but we make it a point to let them know we are Christians and tell them about Jesus and pray for them. Several times students themselves approach us for prayer and counselling. It is indeed a joy to be able to reach out to them.


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