IRS Considering Harvard's Tax-Exempt Status Revocation as DHS Threatens Foreign Student Ban

Harvard University is facing an extraordinary double assault from the Trump administration, with the Internal Revenue Service (IRS) planning to strip its tax-exempt status and the Department of Homeland Security (DHS) demanding records on foreign student visa holders. On April 16, 2025, DHS Secretary Kristi Noem ordered Harvard to provide detailed information on the "illegal and violent activities" of its international students by April 30, 2025, or lose its ability to enroll them—a move that could devastate theuniversity's global reputation and financial stability.

Simultaneously, the IRS is preparing to revoke Harvard's tax-exempt status under Section 501(c)(3), which shields the university from federal income and property taxes, as reported by CNN on April 16, 2025. This follows President Donald Trump's April 15 call to end Harvard's tax exemption, accusing it of promoting "political, ideological, and terrorist-inspired" agendas. The IRS's action could cost Harvard millions or billions annually, fundamentally altering its financial landscape despite its $50 billion endowment.

The DHS's ultimatum is a direct threat to Harvard's international student program, a vital component of its academic diversity and revenue. Losing the ability to enroll foreign students would disrupt the university's global standing. Harvard has pledged to comply with legal obligations but emphasized it will not "surrender its independence or relinquish its constitutional rights," hinting at a looming legal battle.

The IRS's move is equally unprecedented. Experts, including R. William Snyder, an accounting professor at George Mason University, note that no administration has previously attempted to revoke a major university's tax-exempt status in this manner. The process would involve a comprehensive audit and negotiations, but Harvard's defiance suggests it is ready to challenge the decision in court. Federal law prohibits the president from directing IRS investigations, raising questions about the legality of Trump's influence.

These actions build on the administration's recent freeze of $2.2 billion in federal funding to Harvard and the cancellation of $2.7 million in DHS grants, part of a broader campaign targeting elite universities over issues like antisemitism, diversity, equity, and inclusion (DEI) programs, and pro-Palestinian protests. Trump has publicly derided Harvard as a "joke" on Truth Social, intensifying the conflict.

With the April 30 deadline for DHS compliance nearing, Harvard stands at a critical juncture. The combined threats to its tax-exempt status and foreign student program could reshape its future and set a precedent for federal oversight of higher education. The outcome will likely ripple across universities nationwide, testing the limits of academic freedom and institutional autonomy.