A 501(c)(3) organization is a tax-exempt organization that is organized and operated for religious, charitable, scientific, literary, testing for public safety, fostering national or international amateur sports competition, or preventing cruelty to children or animals. A 501(c)(2) titleholding corporation, on the other hand, is a tax-exempt organization that is created solely to hold title to property for the benefit of one or more 501(c)(3) organizations. A 501(c)(2) corporation does not have the ability to carry on any activities other than holding title to property.