is a nonprofit corporation a corporation for tax purposes
5 Steps To Forming A Tax-Exempt Nonprofit Corporation. A 501(c)(3) nonprofit corporation is a type of charitable organization that the Internal Revenue Service recognizes as tax exempt. This type of corporation does not pay income tax on its earnings or on the donations it receives. Also, any time a taxpayer makes a donation to a 501(c)(3) nonprofit, they can reduce their taxable income by the amount of their donation if they itemize their deductions on their federal income tax return.