Ending Harvard’s Tax-Exempt Status Is Legally and Morally Sound

Today, President Donald Trump announced that his administration plans to revoke Harvard University’s tax-exempt status. It’s about time.

This latest escalation follows the administration’s decision last month to freeze $2.3 billion in federal funding to the university, citing persistent violations of Title VI of the Civil Rights Act of 1964 related to Harvard’s sustained, systematic engagement in race-based discrimination and its tolerance of antisemitism on campus.

As a matter of law, Section 501(c)(3) of the federal tax code exempts from taxation entities organized and operated exclusively for the purposes specified therein, which include charitable and educational purposes. In three Revenue Rulings, the IRS set forth additional requirements, stating that a Section 501(c)(3) organization’s activities must not be “illegal, contrary to a clearly defined and established public policy, or in conflict with express statutory restrictions.”

These additional requirements are broader than—but along the same lines as—a requirement recognized by the US Supreme Court: A charitable organization may not violate a “national public policy,” and it will lose tax-exempt status if “there is no doubt that the organization’s activities violate fundamental public policy.”

The Supreme Court in Bob Jones University v. United States held that the IRS could (and should) revoke a university’s tax-exempt status because of its racially discriminatory policies. The decision confirmed that tax-exempt status is a form of government subsidy, and that it may be conditioned on compliance with broadly recognized civil rights norms.

The Harvard case is even more straightforward. Unlike the repugnant but still legal policies that Bob Jones University was defending, some of the Title VI violations that Harvard is accused of are also unlawful, triggering the additional Revenue Ruling grounds for losing the exemption.

Contrary to what Harvard claims, removing its tax-exempt status doesn’t violate the First Amendment in any way. This isn’t about targeting Harvard or anyone else because of viewpoints they express, and Title VI violations by definition involve conduct, not speech.

In an analogous case, Christian Legal Society v. Martinez, the Supreme Court held that public universities could deny benefits to groups based on their exclusionary membership policies. These are the kinds of activities that Harvard is accused of engaging in. Based on Justice Ruth Bader Ginsburg’s reasoning in that case, Harvard is confusing its own viewpoint-based objections to nondiscrimination laws (which it is entitled to have and to voice) with viewpoint discrimination.

In this light, the Trump administration’s effort to revoke Harvard’s tax-exempt status isn’t an overreach but a constitutionally sound application of statutory and judicial doctrine, firmly rooted in civil rights enforcement and the tax code.

And it doesn’t chill free expression; it instead affirms the longstanding principle that nonprofit entities benefiting from tax-exempt status must operate in accordance with core federal policies—including prohibitions against racial and ethnic discrimination.

Finally, the focus should be on Harvard’s violations, not on the person making the announcement about their accountability. It is true that federal law prohibits certain officials, including the president, from requesting that the IRS conduct an investigation. But the White House has said that all IRS actions are being conducted independently, and that they began before the president’s public comments. Trump is certainly allowed to be the bearer of good news.

This article does not necessarily reflect the opinion of Bloomberg Industry Group, Inc., the publisher of Bloomberg Law and Bloomberg Tax, or its owners.

Author Information

Anat Alon-Beck is associate professor at Case Western Reserve University Law School.

Mark Goldfeder is CEO and director of the National Jewish Advocacy Center.

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