Trump administration pushes to remove tax exemption for private colleges with DEI policies

The Treasury Department and Internal Revenue Service proposed regulations Thursday that would deny tax-exempt status to private educational institutions engaging in racial discrimination. The proposal covers private primary and secondary schools, colleges, universities, professional schools and trade schools, potentially affecting as many as 18,000 institutions, according to Treasury and the IRS. It would apply to admissions, scholarships, loans, athletics, facilities and other school-supported programs, while permitting race-neutral assistance based on income, geography, hardship, first-generation status, military-family status or academic achievement. If finalized, the rules would apply to taxable years beginning on or after May 31, 2027. Treasury Secretary Scott Bessent said race-based practices cannot be rebranded to avoid the restriction. The agencies cited Supreme Court precedents including Bob Jones University and Students for Fair Admissions. The proposal remains subject to public comment and possible legal challenges. The supplied story incorrectly identifies Title IV; relevant federal civil-rights enforcement uses Title VI.