After President Donald Trump called for the Internal Revenue Service (I.R.S.) to revoke Harvard’s tax-exempt status, Fordham Law Professor Gowri Krishna ’06 told The New York Times that this is not the first time the agency has challenged the tax exemptions of educational and other institutions.
In the past, the I.R.S. has challenged the tax exemptions of educational and other institutions under both Republican and Democratic administrations, according to Gowri Krishna, a professor at Fordham University School of Law who specializes in nonprofit law.
In one well-known example, Bob Jones University in South Carolina, a fundamentalist Christian institution that had banned interracial dating, lost its tax-exempt status over its discriminatory policies in a case that the Supreme Court ruled on in 1983. The university had claimed that the I.R.S. had violated its religious liberty. The university lifted the ban in 2000, and said in 2017 that it had regained its tax-exempt status.
But it is rare for the I.R.S. to revoke the tax-exempt status of an educational institution. Tax laws also provide organizations the right to appeal an adverse decision by the agency.
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In a statement issued in April, Harvard said that there was no legal basis for rescinding its tax status. Any attempt to take away Harvard’s tax exemption would be likely to face a legal challenge, which tax and legal experts expect would be successful.
“Harvard would argue there’s a violation of its free speech and academic freedom,” Ms. Krishna said. “I think it would be highly, highly unlikely that the government would win.”
Read “What Is Tax-Exempt Status and Can the I.R.S. Revoke It From Harvard?” in The New York Times.