For more than a century, the majority of colleges and universities have not paid most taxes. The income of 1909 apologized non -profit organizations operating “exclusively for religious, charities or educational purposes” in order to continue to act in the public interest.
President Donald Trump is seeks to challenge this designationcomplaining that colleges and universities “indoctrinate” their students with “radical left” ideas, rather than educating them. And he decided to start with Harvard University, 388, one of the most prestigious learning institutions in the world and the first college founded in the American colonies.
Archon Fung, professor at John F. Kennedy School of Government, is aimed at students, teachers and members of the Harvard University Community Rally, Thursday, April 17, 2025, in Cambridge, Mass. (AP photo / Charles Krupa)
Tuesday, he targeted Harvard University in An article on his social networks Site, wondering if it should remain exempt from tax “if it continues to push political, ideological and terrorist inspired / supporting” disease “. Do not forget that the status of tax exemption depends completely on the action in the public interest! »»
The status of fiscal exemption, which is decided by the internal returned service, means that these institutions do not pay certain types of taxes and that their donors receive a tax deduction when they make gifts. The rules they must follow to maintain this status are set out in the tax code. We talked about lawyers specializing in non -profit law and freedom of expression to try to answer questions about this challenge.
Does the university ‘study program affect its charitable status?
In general, no. Colleges and universities have a wide room for maneuver to design the education they offer.
Genevieve Lakier, an academic of the first amendment to the Faculty of Law of the University of Chicago, said that the United States Supreme Court had presented four essential freedoms for colleges and universities – than teaching, how to teach it, who are their students and who are their teachers.
“It is the irreducible nucleus of academic freedom and it is protected by the Constitution in this country,” she said, adding that the government cannot threaten any financing reductions or revoke the tax status of a school as a punishment for its opinions or what the school teaches.
The first amendment also protects the rights of other non -profit organizations to continue their charitable missions under the freedom of assembly, said Lakier, even if these missions are odious or if the government does not like them.
Can the president ask the IRS to revoke the status of tax exemption from a non-profit organization?
No, it is not supposed, according to two non -profit tax lawyers which wrote on a previous call Of Trump to revoke the non -profit status of colleges and universities.
In 1998, the Congress adopted a law which intervened that federal officials told the IRS to investigate any taxpayer in order to increase the confidence in the tax application.
Lawyers, Ellen April and Samuel Brunson, also underlined legislation which prohibits the IRS “from targeting individuals and organizations for ideological reasons”, after a controversy on the way in which he treated tea groups in 2013.
Students, teachers and members of the Harvard University Community Rally, Thursday, April 17, 2025, in Cambridge, Mass. (AP photo / Charles Krupa)
H
OW does a non-profit organization obtain and does it keep its tax exemption status?
IRS recognizes several reasons For a non -profit organization to be exempt from paying many types of taxes, including the continuation of charitable, religious or educational missions. The status specifically appoints sports competitions, preventing cruelty to children or animals and the defense of human or civil rights for exempt purposes.
Non -profit organizations can lose their tax exemption status for things such as the poor payment of its administrators, approving a political candidate or operating a company unrelated to their charity.
In short, tax lawyers say that non -profit organizations must operate “exclusively for charitable purposes”, which is a standard different from what the president called “act in the public interest”.
Phil Hackney, professor of law at the University of Pittsburgh, said: “Long history and the previous one suggest that Harvard and higher education establishments operate for educational purposes, which are considered charitable”, under the Tax Code.
He said that it would be extremely difficult to argue that a college or a university did not work for charitable purposes under the current law. However, Edward McCaffey, who teaches tax policy at the University of Southern California, the Gould School of Law, warned that there was a precedent for the IRS revoking the exempt status of college tax on which the government could rely.
“I think that rejecting it as an exaggerated boastful and that the administration does not have the power to prosecute it unilaterally, I think it’s naive,” said McCaffery. “It could happen.”
Has IRS already stripped a college of its tax exemption status?
Yes. In 1983, the Supreme Court confirmed a lower justice decision according to which IRS could refuse tax exemption status at Bob Jones University, a private Christian university which prohibited interracial meetings and marriage on campus, and Christian schools in Goldsboro, which employed racically discriminatory admission policies.
The court concluded that the IRS had a certain discretionary power to determine whether an organization requiring the status of tax exemption met the standards of “charity”, which means that it must serve a public objective and not be contrary to the established public policy “.
However, McCaffey said: “IRS ‘ability just to come and refuse tax exemption, it is better to be a very clear public policy, long and deeply held and not political preferences for certain types of posts, attitudes and voting patterns.”
How can IRS revoke the tax exemption status of a non-profit organization?
Usually, the IRS would open an audit, where it collects evidence that a non -profit organization does not work exclusively for charity.
“The IRS should send Harvard a proposed revocation of its status,” said Hackney. “At this point, Harvard would have many different ways to speak with the IRS of the reason why they thought they were in the law”, including the prosecution.
However, Hackney said that the US Treasury Ministry could implement new regulations, for example, declaring that the exploitation of a program of diversity, equity and inclusion does not comply with charities. Such a change would generally take years to do and run against the decades of previous preceding, said Hackney.
“I am skeptical that this effort will succeed,” he said. “If that was the case, it would be the most dramatic change in the charity of my life and I would say in the history of our charity law.”
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This story has been updated to reflect that Harvard University is 388 years old. A previous version said she was 488 years old.
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