Trump threatens tax exemptions of colleges, universities for ‘radical indoctrination’
WASHINGTON, D.C. (WKBT) — President Donald Trump threatened, in two tweets today, the tax-exempt status of schools, colleges and universities that he alleges provide “radical indoctrination.”
Trump did not explain what prompted the remarks, but they amounted to his third threat this week to punish schools financially. The earlier threats were interpreted to mean that he would pull federal funding from public schools if they don’t open this fall.
Today’s tweets seemed to be aimed at higher education, saying: “Too many Universities and School Systems are about Radical Left Indoctrination, not Education. Therefore, I am telling the Treasury Department to re-examine their Tax-Exempt Status…
“… and/or Funding, which will be taken away if this Propaganda or Act Against Public Policy continues. Our children must be Educated, not Indoctrinated!”
Almost all U.S. public and private universities and colleges are tax-exempt because of their educational purposes or the fact that they are under state governments, according to the Association of American Universities.
The IRS defines schools broadly and gives them leeway in their offerings, for example: “An educational organization is one whose primary function is to present formal instruction that normally maintains a regular faculty and curriculum and that normally has a regularly enrolled body of pupils or students in attendance at the place where it regularly carries on its educational activities. The term includes institutions such as primary, secondary, preparatory, or high schools, and colleges and universities. It includes federal, state, and other publicly supported schools that otherwise come within the definition.”
In addition, IRS regulations note that “advocacy of a particular position or viewpoint” still can qualify as educational for tax purposes “if there is a sufficiently full and fair exposition of pertinent facts to permit an individual or the public to form an independent opinion or conclusion.”
Trump has limited power to slash universities’ tax exemption, analysts say, but he could make policy changes to punish them financially.
“Any drastic or dramatic change would require Congress to act,” said James Lucier, an analyst at Capital Alpha Partners LLC in Washington.
Many universities also rely on federal government research contracts, which the Trump administration could curtail, Lucier told The Detroit News.
Trump’s own university famously was shut down for fraud in 2010 and forced to pay a $25 million settlement to students in February 2018 after years of court wrangling.
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