well the IRS has enacted intermediate sanctions should the members of the organization engage in practices that may excessively benefit any of the organization's members (or officers, directors, etc.) rather than revoking the organization's exempt status (which was the only option available before the adoption of intermediate sanctions) the IRS may now levy a penalty on the organization for engaging in a transaction that resulted in a private inurement or private benefit. See the entry on intermediate sanctions for more detailed information. Differing requirements at the state and federal levels The State Laws are organized to initiate the non-profit process which is required by the Internal Revenue Service (IRS)to apply for non-profit status. Some States lack Laws that require non-profits that do not get approved for Federal tax exemption to amend their business type to for profit. It is clear that the https://www.usa.gov/start-nonprofit states that United States non-profit laws relate to taxation, not just activities that benefit the public. Most States require the Federal tax exemption approval via a"determination letter" to apply to become State tax exempt. The steps required to become a nonprofit include applying for tax-exempt status. If States are not requiring the "determination letter" from the IRS to grant non-profit tax exemption to organizations, on a State level, claiming non-profit status without that Federal approval, then they are actually violated Federal United States Nonprofit Laws. Many States lawmakers do not have knowledge of these facts and therefore do not realize they are non-compliant. Organization Generally, non-profits and people operating non-profits must comply with all of the same laws which would apply to for-profit businesses. There are exceptions for taxes (noted above) and some exceptions related to First Amendment concerns, noted below. Directors and officers of non-profits owe a fiduciary duty to the non-profit and its beneficiaries similar to the duties owed by directors and officers of for-profit corporations. Non-profits can have vicarious liability for injuries caused by their employees or volunteers to third parties, such as by traffic accidents. For this reason it is prudent for any non-profit to obtain liability insurance. Non-profits which have paid staff must comply with minimum wage laws, and with the requirement in most states to obtain workers compensation insurance. Churches and religious non-profits are something of a special case, because the First Amendment to the U.S. Constitution forbids the government making a law "respecting an establishment of religion," and also forbids