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Private Operating Foundations Are Hybrids

Private Operating Foundations Are Hybrids

Private Operating Foundations Are Hybrids

Organizations which are not publicly supported but use most of their assets and income in the active conduct of their charitable activities avoid some private foundation limitations.

Most charities exempt under Section 501(c)(3) of the Tax Code are classified either as publicly supported organizations, including churches, schools, hospitals, social service or healthcare organizations and cultural groups, or as private foundations, which are usually endowments making grants to other charities. Private foundations must function under significantly more stringent limitations, and organizations would usually rather qualify as publicly supported.

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