IN RE: Salaries as a portion of income.

   First of all, your terms are screwy: Not-for-profits, by definition,
   don't have a "gross profit." Later in your post, you seem to re-cast
   the question to: is there a standard for what portion of gross revenue
   is used for salaries?

   The short answer is: no.  In service agencies, almost all of the
   revenue is used for salaries, besides rent, non-capital equipment,
   supplies, insurance, etc.  In a museum, more might be used on
   non-salary items having to do with caring for a structure or
   collection and mounting exhibitions.

   The longer answer is that funders will certainly look at how your
   income is being spent.  If you raise $200,000 each year, and 50% of
   that is spent on the director's salary, then funders will definitely
   question the value of giving you money toward your mission.  This
   kind of arrangement suggests a possibly shady not-for-profit, like the
   "drum and bugle corps" run by a district superintendant in New York
   City.  The Times reported a situation like the one you describe, where
   it appears that this not-for-profit exists principally to contribute
   to the income of its director.

   Eric Siegel
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