Nonprofit corporations are a type of corporate entity that limits payment or distribution of any part of its assets, income, or profit except in conformity with the purposes of the corporation. Generally, a nonprofit corporation is created under the Michigan Nonprofit Corporation Act. However, there are many special acts that permit the formation of a wide variety of nonprofit corporations. Some purposes for which nonprofits are commonly formed are those involving religious, educational, and charitable activities. 

Moreover, a corporation is a legal entity having its own rights, privileges and liabilities, apart from those of the persons forming or owning the corporation. It is the most complex form of business organization and is comprised of three groups of people - members/shareholders, directors, and officers. The corporation can own assets, borrow money, and perform business functions without directly involving the owner(s) of the corporation. The corporation is subject to more government regulation than proprietorships or partnerships. However, corporations have the advantage of limited liability.