According to the IRS, "a private operating foundation is a private foundation that devotes most of its resources to the active conduct of its exempt activities."

The IRS states that , "a private foundation may qualify for treatment as a private operating foundation." But, "these founda*tions generally are still subject to the tax on net investment income and to the other requirements and restrictions that gener*ally apply to private foundation activity. How*ever, operating foundations are not subject to the excise tax on failure to distribute income."

Furthermore, "contributions to private oper*ating foundations described in section 4942(j)(3) are deductible by the donors to the extent of 50 percent of the donor’s adjusted gross income, whereas contributions to all other private foun*dations (except those discussed under Private Pass-through Foundation ) are gen*erally limited to 30 percent of the donor’s adjusted gross income."

It is also worth noting that a private operating foundation may receive qualifying distributions from a private foundation, provided that the private founda*tion does not control it.

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