Nonprofit status (sometimes called not-for-profit) indicates that an organization is created for some public purpose, rather than for the benefit of owners, as in a for-profit entity. Nonprofit status is typically declared when the entity is created under state law, most commonly by incorporating the entity as a nonprofit corporation.
In the United States, nonprofit status is determined by state law, and most states have enacted special laws governing the creation of nonprofit corporations (which, depending on the state, may be called "not-for-profit corporations" or "non-stock corporations"). Some states allow the creation of other types of legal entities, such as limited liability companies (LLCs), as nonprofit organizations. Each state has slightly different laws that govern the creation of nonprofit corporations in that state.
According to John M. Stevens, Jr, "[the] federal Volunteer Protection Act of 1997 [provides] sweeping immunity to volunteers. It shields them from any claim arising from acts performed within the scope of the volunteer's responsibilities in the organization, provided the conduct was not of a particularly egregious variety."
Despite the apparent meaning of the word "nonprofit," nonprofit entities may conduct activities that bring in more money that than they cost. There is no requirement that nonprofit organizations rely solely (or at all) on donations. Furthermore, such activities need not entirely or even incidentally advance the purpose of the organization, and concerns about particular activities threatening the nonprofit status of a convention are almost always spurious as long as the organization also has activities that further an exempt purpose. (reference: [])
Note that "nonprofit" status is frequently a prerequisite for, but not the same as tax-exempt status.