Can an NGO’s excess income be used for other than its charitable purpose?

The article analyzes the importance of non-governmental organizations (NGOs) in a civil society development and democratic governance of a state. One of the basic features of a civil society is the opportunity for people to freely join together and create organizations that will help them to solve various problems. Nowadays, the role, function and importance of the third sector have been considerably augmented, so it is necessary to determine NGOs charitable purposes and to warrant efficient usage of charitable funds. The object of the article is the usage of NGO’s excess income. The paper deals with the situations in which a non-governmental organization received charitable contribution or income, but an accomplishment of the charitable purpose specified in its bylaws does not require the entire amount. The author of this paper tries to find the answer to the problem if NGO’s excess income can be used for other than its charitable purpose. The article contains descriptive and comparative methods based on jurisprudence, statutory law, case law and legal doctrine of Lithuania and the United States, which apply to NGO’s activities. Solely legal framework of the USA is explored, because of very well developed law of charitable activities and broad judicial practice explaining the issue whether NGO’s surplus incomes for other than its charitable purpose. The author of the article compares the study of the USA judicial system to Lithuanian laws and offers possible solutions. The paper is divided into three parts. Firstly, the author sets the basic features of NGOs as far as it is necessary to evaluate the importance of NGO’s activities useful for the public, ability for NGO’s excess income to appear and how significant it is not to limit the options to NGO that receives excess income to achieve greater efficiency and provide society or area with more benefit.[...]Vytauto Didžiojo universiteta