People need to understand that “non-profit” is a tax term. That’s it. It has nothing to do with morality, or volunteerism, or helping your fellow man, etc. It’s a tax term and tax status. And tax statuses come with rules. If you don’t like the rules, don’t apply for the status.
I had a friend that jumped through a ton of hoops to finally get the status. But after working under it for a short time, he abandoned it. It wasn’t worth the government involvement and ongoing requirements.
The legal status for a nonprofit is supposed to be that you are essentially the custodian of an entity for the public good, because with the tax breaks given the public is helping to fund it.
Recently set up a scholarship fund in name of dear departed friend...NO WAY will it be non profit! And the fund doesn’t care what a parents income is, either.