Because nonprofit corporations have a more restricted range of powers than business corporations, actions not authorized by the charters of nonprofit corporations are more likely to be found ultra vires.

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Nonprofit corporations are formed for charitable, educational, religious, or other purposes that benefit the public. They have limited powers and are subject to stricter regulations than business corporations. Actions that are not explicitly authorized in their charters or bylaws are more likely to be considered ultra vires or beyond their legal authority. This is because nonprofits have a duty to use their resources in accordance with their stated mission and to avoid engaging in activities that do not serve their tax-exempt purposes. Any improper or unauthorized use of resources can result in legal or financial penalties, loss of tax-exempt status, and damage to the nonprofit's reputation.

Because Nonprofit Corporations Have a More Restricted Range of Powers