A private operating foundation is not subject to the tax on net investment
income if it is an exempt operating foundation. In addition, private foundations
may make grants to exempt operating foundations without complying with
the expenditure responsibility requirements. In general, an exempt operating
foundation is a private foundation that has been publicly supported for
10 years; whose governing body consists of individuals less than 25 percent
of whom are disqualified individuals and is broadly representative of
the general public; and has no officer who is a disqualified individual
during the year.
If you have more questions informing a private foundation, call our Dallas
Nonprofit Attorneys at the Perliski Law Group today!