A not-for-profit or non-for-profit organization (NFPO) is a legal entity that does not distribute surplus funds to its members and is formed to fulfill specific objectives.
[3] An NFPO must be differentiated from a NPO as they are not formed explicitly for the public good as an NPO must be, and NFPOs are considered "recreational organizations", meaning that they do not operate with the goal of generating revenue as opposed to NPOs.
[4] An example of this is a sports club, which exists for the enjoyment of its members and thus would function well as an NFPO, with revenue being re-invested into improving the organization.
[1] These organizations typically file for tax exemption in the United States under section 501(c)(7) of the Internal Revenue Code as social clubs.
This revenue might come from donations, fundraising, or other activities undertaken to support their charitable cause.