White House moves to revoke Harvard's tax-exempt status, news reports say

Boston Globe

17-04-2025

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Citing three unnamed people familiar with the situation, the Post said the Treasury Department has asked the IRS's top attorney to take away Harvard's tax exemption. The exemption means there are no federal income taxes on donations to the university and on income from investments in its more than $50 billion endowment fund.
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Also on Wednesday, Homeland Security Secretary Kristi Noem said she was
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Spokespeople for the White House and the IRS did not respond to requests for comment Wednesday night.
In a statement, Harvard spokesperson Jason Newton said, 'There is no legal basis to rescind Harvard's tax-exempt status.'
'Such an unprecedented action would endanger our ability to carry out our educational mission. It would result in diminished financial aid for students, abandonment of critical medical research programs, and lost opportunities for innovation,' Newton added. 'The unlawful use of this instrument more broadly would have grave consequences for the future of higher education in America.'
James Repetti, a Boston College law professor, said losing its tax-exempt status 'would be catastrophic for Harvard.'
'Their income would become taxable, their donations to Harvard would no longer be tax deductible,' he said. 'One of the incentives for people to make contributions to Harvard is that it reduces their tax liability, so it would be very difficult for them.'
John Koskinen, who served as IRS commissioner from 2013 to 2017 under President Barack Obama, decried the move and said it was unlikely to withstand judicial review.
'It's troubling that the administration and the president would be, in effect, instructing the IRS to even look into this,' he said.
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Koskinen said directing the IRS to revoke Harvard's tax exempt status would run afoul of that statute, which was enacted in response to President Richard Nixon's use of the agency to punish political opponents.
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He and other experts said the only time a university's tax exemption has been revoked was in 1976, when the agency took the action against Bob Jones University, a private Christian institution in South Carolina that had a policy forbidding interracial dating by its students. The Supreme Court upheld the IRS action in 1983.
'I don't think that any president or vice president should single out any institution in America that they dislike by threatening their tax exempt status and or demanding an audit of them,' said Representative Richard Neal of Massachusetts. He is the top Democrat on the House Ways and Means Committee, which oversees the IRS.
In response to Trump's threat,
Lawrence Gibbs, who served as IRS commissioner under President Ronald Reagan, said it is not unusual for elected officials from either party to ask the IRS to revoke tax exemptions for certain organizations, but the final decision has traditionally been left to the IRS alone.
'What is somewhat unusual, although there is precedent for it, is to have a politician who attempts to influence the Internal Revenue Service about whether or not to consider the request and whether or not to revoke the exemption,' Gibbs said Wednesday night.
That precedent came under Nixon. Gibbs said he never received such a request from the Reagan White House during his time as IRS commissioner. If such a request had come through, he said, he would have referred it to the tax exemption wing of the IRS 'and tell them to handle it as they see fit.'
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If the IRS takes action against Harvard, the university would have several avenues of appeal, starting with the agency's own process, Koskinen said.
'Usually a stay is put in place until the case is resolved,' he said. 'Clearly you have a right to object to an arbitrary decision by the agency, and especially one that's been dictated illegally by the president, so they wouldn't lose their tax exempt status overnight without warning.'
The White House has ramped up its fight against Harvard after it defied the administration's demands. On Monday night, the Trump administration froze $2.2 billion in federal funding for the university.
Asked about the tax threat on Tuesday, White House press secretary Karoline Leavitt referred reporters to the IRS. But she also blasted Harvard for what she called illegal harassment and discrimination against Jewish students.
'Unfortunately, Harvard has not taken the president or the administration's demands seriously. All the president is asking [is] don't break federal law and then you can have your federal funding,' she said.
Leavitt also suggested Harvard should not be receiving so much federal funding in the first place.
'I think the president is also begging a good question: more than $2 billion out the door to Harvard when they have a more than $50 billion endowment,' Leavitt said. 'Why are the American taxpayers subsidizing a university that has billions of dollars in the bank already? And we certainly should not be funding a place where such grave antisemitism exists.'
Repetti of Boston College said Harvard's tax-exempt status should not be revoked.
The university, 'is doing everything that is consistent with the underlying rationale for exempting nonprofit educational institutions from income tax,' Repetti said. 'I think it's shocking that we've come to this point in our nation's history that we're actually having to see something like this threatened. ... It's a very sad moment for our country.'
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Mike Damiano of the Globe Staff contributed to this report.
Jim Puzzanghera can be reached at