An article summarized by The Center Square:
The Trump administration is proposing new Treasury Department and IRS rules that could strip federal tax-exempt status from private schools found to discriminate based on race. Officials estimate the rule could affect as many as 18,000 private educational institutions, including K-12 schools, colleges, universities, professional schools, and trade schools.
The proposed regulations would eliminate previous IRS guidance that allowed racial preferences in areas such as admissions, scholarships, financial aid, programs, and facilities. The administration argues that race-based preferences conflict with Supreme Court decisions, including the Court's 2023 ruling against the admissions practices used by Harvard and the University of North Carolina.
The rules would not prevent religious schools from selecting students based on genuine religious affiliation, and schools could still consider factors such as income, geography, first-generation status, personal hardship, military family status, and academic achievement. Treasury Secretary Scott Bessent said institutions that continue using race-based discrimination should no longer receive federal tax benefits, with the proposed changes set to apply beginning in taxable years after May 31st, 2027.
