Besides the ubiquitous 501(c)(3) corporations, there are other types of non-charitable corporations that are exempt from federal income tax as well. These include civic leagues and social welfare organizations (which include local associations of employees, certain homeowners' associations, advocacy organizations, and junior chambers of commerce); labor, agricultural, and horticultural organizations, such as labor unions or organizations connected with raising livestock, forestry, harvesting crops, aquatic resources or the cultivation of useful or ornamental plants; business leagues or other organizations formed to promote the interests of a particular industry or industries, such as trade associations and chambers of commerce; social and recreation clubs, such as college fraternities or sororities, country clubs, garden clubs, hobby clubs, and college alumni associations; Fraternal beneficiary societies and fraternal organizations; and other nonprofit organizations such as voluntary employees' beneficiary associations; local benevolent life insurance associations; cemetery companies; credit unions and mutual financial organizations; supplemental unemployment benefit trusts; veterans organizations; black lung benefit trusts; title holding corporations for multiple parents; state- sponsored high-risk health coverage organizations; and state-sponsored worker's compensation reinsurance organizations.

The biggest thing is that if your corporation is tax exempt, such organization would not be subject to federal income tax to the extent the money is generated and used in furtherance of the corporation’s tax exempt purpose. Furthermore, often if a corporation is exempt from federal tax, it is exempt from state income tax as well, as well as local property tax. Also, such an organization is exempt from excise tax on wagers, that is, a tax exempt corporation would not have a tax on a drawing or lottery conducted on its behalf. However, it should be noted that unlike with 501(c)(3) charitable corporations, donors may not be able to deduct donations made to such tax exempt corporations.