The IRS may revoke Harvard University’s tax-exempt status after the Ivy League institution refused to meet President Donald Trump’s broad demands for policy changes, CNN and the Washington Post reported on April 16.
According to the Post, the Trump administration requested that the IRS revoke the Cambridge, Massachusetts university’s tax-exempt status. CNN reported that the agency is planning to do so.
Trump and Harvard are feuding over his claims that the university failed to adequately protect Jewish students during pro-Palestinian protests last year, as well as his belief that the university is a beacon of diversity, equity, and inclusion programs.
For several years, Republicans have debated whether to revoke Harvard and other “woke” universities’ tax-exempt status for DEI policies while allowing anti-Israel protests.
“Perhaps Harvard should lose its Tax Exempt Status and be Taxed as a Political Entity if it keeps pushing political, ideological, and terrorist inspired/supporting ‘Sickness?'” On April 15, Trump posted to Truth Social. “Remember, Tax Exempt Status is totally contingent on acting in the PUBLIC INTEREST!”
The White House has frozen $2.2 billion in grants and $60 million in contracts awarded to Harvard for refusing to implement a mask ban, change programs that promote antisemitism, and eliminate diversity, equity, and inclusion initiatives.
In a statement to USA TODAY, Harvard spokesman Jason Newton called the possibility of losing the tax exemption “unprecedented,” and said the university’s current tax status allows it to provide more funding for students, researchers, and technological advances.
“There is no legal basis to rescind Harvard’s tax-exempt status,” he said. “The unlawful use of this instrument more broadly would have grave consequences for the future of higher education in America.”
Harvard is the United States’ oldest university, having been founded in 1636. Harvard, like most other universities, has long been exempt from federal income taxes because it provides a public service.
On April 14, Harvard President Alan Garber stated that the White House’s demand for outside scrutiny of Harvard programs “goes beyond the power of the federal government.”
He went on to say, “Freedom of thought and inquiry, combined with the government’s longstanding commitment to respecting and protecting it, has enabled universities to contribute in vital ways to a free society and healthier, more prosperous lives for people everywhere.” All of us have an interest in preserving that freedom.”
Harvard’s endowment is approximately $53 billion, providing a substantial financial cushion to fight the White House.
According to the Washington Post, officials from the Treasury Department, which includes the IRS, conveyed the request to revoke Harvard’s tax-exempt status. The IRS has the legal authority to change tax-exempt status, and it is expected to use that power impartially. The president cannot request that changes be made to any taxpayers’ status.
According to Kiplinger, one analysis suggested that losing Harvard’s tax-exempt status could cost $500 million per year. Legal experts believe Harvard will undoubtedly appeal the loss of its tax-exempt status.
The move by the Trump administration reflects the president’s ongoing campaign against universities, which he claims have led the country astray by focusing too much on America’s failings and allowing college students to protest.
Trump has previously targeted Columbia University, which has agreed to many of his demands, and has opened an investigation into 59 other universities on the grounds that they have allowed antisemitism to flourish.
“Harvard has been hiring almost all woke, Radical Left, idiots, and “birdbrains” who are only capable of teaching FAILURE to students and so-called “future leaders,” Trump wrote on Truth Social on April 16. “Harvard is a JOKE, teaches Hate and Stupidity, and should no longer receive Federal Funds.”
Trump has named Gary Shapley as the IRS’s acting commissioner. Shapley, a former IRS criminal investigator, accused the Biden-era Justice Department of slowing the Hunter Biden investigation.
In January, Rep. Jason Smith of Missouri, chairman of the Republican-controlled House Ways and Means Committee, sent a letter to several universities, including Harvard, demanding that they justify their tax-exempt status.
He also pointed to “ongoing concerns that ‘elite’ American universities are failing to provide instruction beneficial to individuals or the community and are instead instructing students to have disdain for the United States and the very communities they live in.”
“Ultimately, as the U.S. House Committee with primary jurisdiction over tax-exempt institutions and the treatment of their endowments, we are left to wonder whether reexamining the current benefits and tax treatment afforded to your institutions is necessary,” Smith said in her letter.
