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J. Warren
J. Warren, Attorney
Category: Business Law
Satisfied Customers: 2192
Experience:  Experience in general business transaction and formation matters.
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I know a non profit can have a for profit subsidiary, but can

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I know a non profit can have a for profit subsidiary, but can a for profit have a non profit subsidiary?
Hello and Welcome. My goal is to do my very best to understand your situation and to provide a full and complete answer for you.

Yes a for profit may create a subsidiary controlled nonprofit. Typically a wholly controlled non-profit subsidiary is used to serve as private foundations for the for-profits philanthropy.

However, the IRS carefully scrutinizes such arrangements for possible private benefit to the parent for-profit. The purpose of the non-profit must be significantly different than the purpose of the for-profit.

I hope this helps. All my best & encouragement.

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Thank you for allowing me to be of service to you. Please be aware that the information provided here is not legal advice. Rather it is simply general information. All states have intricacies in their laws and any information given is simply information only and specifically is not intended to be, nor does it constitute, legal advice. This communication does not establish an attorney-client relationship with you.

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