Phil Jackson has reached an agreement in principle to oversee the Knicks basketball operations and “president’’ will be in his title, according to a league source.

All that’s left is the lawyers finalizing the last contract details by week’s end before Jackson officially returns to the organization that drafted him and where he won two titles as a player.

The Post has learned Jackson gave the Knicks a verbal commitment on Saturday. The Garden still will not comment on Jackson’s status.

Knicks president/general manager Steve Mills will remain on board in a revised role and work with Jackson. Knicks owner James Dolan hired Mills because of his vast network of contacts with NBA agents and GMs. That isn’t the strong suit of Jackson, winner of 11 titles as coach of the Bulls and Lakers.

Some issues during the last couple of days revolved around his living arrangements. Jackson lives in Marina Del Rey, Calif., with his fiancée, Lakers president Jeanie Buss. Jackson is expected to live in New York during the season, but do some commuting. Buss visits New York on business periodically.

During Jackson’s failed negotiations with the Lakers last season, he reportedly asked for $11 million to $12 million a year. He made $12 million in his second-to-last season coaching the Lakers in 2009-10, but took a “pay cut’’ to $10 million in 2010-11, his final season with the team.

Jackson has five kids and seven grandchildren, but because Buss, 52, has no plans to retire, he became bored during his time away from the NBA, sources said, and has eagerly anticipated a front-office job.

Buss declined comment, saying it was inappropriate to talk about another club’s business.

The third time is the charm for Dolan, who had tried to woo Jackson twice previously. Dolan failed in 1999 when Jeff Van Gundy was coaching and again in 2005 when Isiah Thomas attempted to lure Jackson.

Three years ago, Buss told The Post, “I can tell you he was open to going to the Knicks in 2005, then the Laker job opened up. The Knicks job would bring him full circle and I wouldn’t stop him.’’

Jackson has spoken fondly about his mentor, former Knicks coach Red Holzman, who Jackson said was the reason he wanted to get into coaching.

“There’s no doubt Red took special affection toward our relationship,” Jackson told The Post in 2004, when he was about to break Red Auerbach’s coaching-title record. “He always called me after a winning season. When it was Bulls-Knicks in the conference finals, he always made a point of seeking me out, right up until the end. I’m sure he’s somewhere up there smiling down.”

Now it appears Jackson will attempt to help resuscitate a Knicks franchise that has collapsed this season. The Knicks began to rebuild in 2008 to get under the salary cap in an attempt to sign LeBron James.

Apart from last season’s No. 2 seed, the results didn’t materialize, with the Knicks a long shot to make the playoffs and looking to rebuild again with Carmelo Anthony as their centerpiece. Anthony is a free agent this summer and doesn’t know Jackson well, but Jackson has 11 championship rings with which to woo Anthony.

Jackson does not have experience building an NBA roster. Before his coaching exploits with the Bulls and Lakers, he worked for five seasons in the defunct CBA in Albany, where he constructed fluctuating rosters in a chaotic environment.

Jackson, a member of the Knicks’ 1970 and ’73 championship teams, appeared in 732 games in 11 seasons with the franchise, placing him fifth on the franchise’s all-time list of games played.