A 501(c) organization is a specific type of nonprofit organization recognized by the Internal Revenue Service (IRS) under section 501(c) of the Internal Revenue Code. It is an organization that is exempt from federal income tax under this section. A nonprofit organization, on the other hand, is an organization that uses its surplus revenues to achieve its goals, rather than distributing its surplus income to the owners or shareholders as profit or dividends. Not all nonprofit organizations are 501(c) organizations; some may be tax-exempt under other sections of the tax code.