(Non-)Commercial - means what really? 4

[cian]

Subject line says it all, what does Commercial or non-commercial really mean?

The definition "not for profit" is pretty vague. Is there a standard definition which one can safely use?

If a site doesn't sell anything it's non-comm. But what if they have advertising? Does that alone make the site commercial?

(Apologies if wrong forum, couldn't think where else to put it.)

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[deecee]

well in the US a company that is designated not for-profit at the end of the year must show a +/- of 0. That means any money they would make as profit would have to go towards something they are earning for. this is where a lot of scams arise -- company heads will pay themselves huge amounts of money that should be going towards a worthwhile cause but technically the company isnot making money when their expenses=revenue. Basically a non-comm company is just strving to make enough to pay expenses.

zzzzzz

 

[cian]

I've been doing a lot of reading on it and it's impossible to pin down an exact definition.

The reason I am asking this is that I want to remain non-comm but am forced to use advertising and affiliate schemes to pay costs.

Some definitions which I like ;-)

"If the primary purpose of a site is to generate revenue or promote the sale of goods or services online or offline, then it is considered commercial." Zeal.com

"If you’re an Amazon affililiate but are not making substantial money, then no, I wouldn’t consider it. By substantial, I mean a steady revenue; most personal webloggers do not make enough money per quarter to consider the affililiate program a source of income." Movable Type

I reckon if you are only using advertising to keep your site online then it's hardly commercial ...but that's just my defn. ;-)


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[Kjonnnn]

A non-profit / not-for-profit company does NOT need to have a zero balance at the in of the fiscal year. The terms simple means that there is no intent, the reason for existence is NOT to make a profit. Many organizations have bank accounts with money at year end. Work for two.

Here's a good descrip.

Non-Profit Organization - economic institution that operates like a business but does not seek financial gain. Examples are schools, churches, and community service organizations. Non-profit organizations often provide goods and services to consumers while they pursue other rewards such as improving educational standards, seeing the sick become well, and helping those in need. Many are legally incorporated to take advantage of the unlimited life feature such as private welfare groups, adoption agencies, and youth or civic clubs.

Non Profits organizations are generally those business organizations that exist to serve some public need without the intent of making a profit. There is a long history of service to consumers as well as producers in the the American workplace. The actions of non profit organizations, while often unnoticed, are quite important.

Some economics students have noticed the different uses of the term non profit and not for profit and have inquired into the differences between the two. In recent discussions in one class we defined non profit as business organizations designed to perform a service for others and not for profit as charitable organizations. While this delineation does exist the terms used are wrong. There is, in reality, no difference between the two terms. Legal statutes even refer to the two terms as being synonymous. But the *practical* legal definition (as established by the wise and beneficial people at the IRS) does make a distinction.

"Not-for-profit" refers to an activity, for example, a hobby (like fishing).
"Nonprofit" refers to an organization established for purposes other than profit-making. Note here that nonprofit does not necessarily mean "charitable."
For example, a "nonprofit" organization can be an association of people who like fishing (though the activity does not have to be not-for-profit).

In the end, both terms are frequently used and frequently seen. There is no firmly established distinction, though some people have strong preferences between them.

The federal government has distinguished between the different types of non profit organizations based upon their tax code designations. The list below cites the type of non profit organization and the corresponding tax code. The following organizations are all exempt from income tax and are thus considered to be "non profit" by the federal government.

 

[ChrisHirst]

I tend to think that non-commercial use is just for your own personal use, whether the site is commercial or not.

Commercial use would be if a designer used the software\code\component and integrated it into site built and sold to clients.



Chris.

Indifference will be the downfall of mankind, but who cares?

http://www.candsdesign.co.uk

A website that proves the cobblers kids adage.

http://www.cram-system.com

Nightclub counting systems

So long, and thanks for all the fish.

 

[tviman]

I have to agree with Chris. Non-commercial, as far as web sites are concerned, is generally understood as being a "personal" web site where there is no intent to sell, advertise, or otherwise entice/influence a customer base. You're a commercial site if the site is used to generate ANY type of business - for profit or otherwise.

To clarify the definition of a NON_PROFIT orginization, in the US, a non-profit org. must first file with the IRS to get a NON-PROFIT status. Once that is attained, there are very specific rules regarding how much money can be carried forward from one fiscal year to the next and how much money can be in the company cofers at the end of the year.

There's always a better way. The fun is trying to find it!

 

[cian]

Great information kjonnnn, Chris & tviman.

One thing you mentioned tviman demonstrates the confusion concerning this topic.

"Non-commercial, as far as web sites are concerned, is generally understood as being a "personal" web site where there is no intent to sell, advertise, or otherwise entice/influence a customer base."

So if you advertise something you are commercial?
Does it just mean advertise your own products for sale? Someone elses products, like a reseller for example? What about an affiliate scheme? Google Adsense?

It's not at all clear!

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[pixl8r]

Here is the question Cian...

Are you selling anything on your web site? (Services, widgets, whatever...)

Or are you providing links to affiliates that sell things from their websites? This does not make you commercial even if you are placing animated (or non-animated) advertisements on your page. You are not selling any good or service. You are simply providing access to those who do sell goods and services.

A link does not make you commercial. Selling a good or service makes you commercial (as has been stated already).

Hope it helps.

Wow JT that almost looked like you knew what you were doing!

 

[cian]

Hi pixl8r
No i'm selling nothing, but providing links to sites that sell stuff. But of course I earn commission.

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[tviman]

And there's the rub. The fact that you're earning a commission for providing a service makes you "commercial". I know it's a fine line but you know in your heart of hearts that if push comes to shove, the decision will not land on your side of the net.

There's always a better way. The fun is trying to find it!

 

[cian]

On the other hand tviman, since the primary goal is not to make money but to provide a free service (which my site does) does it not remain non-commercial?
It IS a fine line isn't it??

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[Kjonnnn]

I'd advise you to roam around irs.gov.

But since you haven't said anything about forming a company and the website is a possession of the "company," but you're providing this "service" through a website, the income comes to you and still is taxable under your personal tax obligation. So website the classification is moot.

 

[pixl8r]

LOL... I think you should just engage a lawyer!

Wow JT that almost looked like you knew what you were doing!

 

[tviman]

I think what it boils down to is that you're probably using a bit of software, an image, or a piece of code that has a restriction - free for non-commercial use, all pthers must pay. Put yourself in the provider's shoes... what will they think if they look at your site? Since they are the ones who have the controlling vote, it's really a moot issue as far as whether or not you're a "legal" not-for-profit enterprise. It's going to be up to them to determine if you're "non-commercial" or not.

There's always a better way. The fun is trying to find it!

 

[cian]

tviman - the software issue doesn't bother me so much, I can pretty much make what I need now or get software with open licence terms. It's just good to know for future reference.

Thanks for your help all.

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[Kjonnnn]

http://www.nolo.com/lawcenter/ency/article.cfm/objectID/FB682F05-ADA1-4B8A-ACC2830A855686DB