The Trump administration initiated moves to revoke Harvard University's tax-exempt status, citing alleged violations. This involved the Treasury Department instructing the IRS to take action. Simultaneously, $2.7 million in grants were canceled and Harvard was demanded to provide detailed records about foreign students.
Harvard strongly denied any legal basis for revoking its tax-exempt status, warning of devastating consequences for financial aid, research, and innovation. Legal experts raised concerns about the legality of the move, citing a 1998 law against presidential interference with IRS investigations. There is precedent for revoking tax-exempt status, notably Bob Jones University in 1976, a case upheld by the Supreme Court.
The action has drawn sharp criticism, with several individuals and experts condemning it. Former officials stated this move seems politically motivated and unlikely to survive legal challenges. Former Harvard president Larry Summers referred to the threat as “Putin-like”.
The White House also froze $2.2 billion in federal funding for Harvard. The White House press secretary stated that Harvard has not taken the administration’s demands seriously and questioned the amount of federal funding Harvard receives compared to its endowment.