IRS considers rescinding Harvard’s tax exemption status

The Internal Revenue Service (IRS) is reportedly considering revoking Harvard University’s tax-exempt status, an unprecedented move amid the escalating tensions between the Trump administration and America’s wealthiest college.

President Donald Trump recently posted on Truth Social that the Ivy League school should be taxed as a political entity for promoting “terrorist inspired” ideologies. His threat came as Harvard refused to follow government demands to change its DEI and student activism policies to combat on-campus antisemitism.

Harvard already faces a $2.2 billion freeze in federal funding, and yesterday, the Department of Homeland Security announced canceling nearly $3 million in agency grants to the institution.

While the university has a $53 billion endowment to lay back on, most of it is earmarked by the donors for specific research or causes. It still has some amount, $10 billion, that can be used to address issues arising from funding cuts.

However, it warns that stripping its tax exemption would slash financial aid, hinder research, and set a dangerous precedent for higher education in America.

It also threatens the local economy in the Massachusetts area where Harvard employs over 18,700 residents, including teaching and lab staff.