Trump Wants to Remove Tax Break From Schools That Use Race in Admissions

President Donald Trump's administration wants to take away a major financial benefit from schools that use race when deciding who gets in or who receives certain programs. On Thursday, the U.S. Treasury Department and the IRS put forward new rules that would remove 'tax-exempt status' from those schools. Tax-exempt status means a school does not have to pay certain taxes, which saves it a lot of money. The proposal is part of a larger effort by the Trump administration to end programs that consider race in education.

The new rules would cover a wide range of school activities. That includes admissions, scholarships, loans, sports programs, and every other program a school runs or supports. The rules would apply whenever race is considered for any reason, even if a school says it is trying to make up for past discrimination. Treasury Secretary Scott Bessent said that calling race-based programs 'equitable' or 'inclusive' does not change the fact that they treat people differently based on race.

Not everyone agrees with the proposal. Civil rights groups say that programs considering race help fix deep unfairness caused by decades of legal discrimination against Black people and other minorities. The American Association of University Professors said it is thinking about suing to block the new rules. AAUP President Todd Wolfson said the proposal tries to use civil rights law against the very people those laws were meant to protect.

The plan could have a big impact across the country. The Treasury Department estimates that as many as 18,000 schools at all grade levels could be affected. Up to 750,000 students who currently qualify for race-based scholarships might also be impacted. The proposal is not final yet — the public can comment on it, and it would likely face legal challenges in court.

There are some important exceptions in the proposal. Private religious schools could still choose students based on their faith and keep their religious programs. Schools would also still be allowed to help students from low-income families, students from certain areas, or students who are the first in their family to attend college, as long as race is not the reason for the help. The administration says these race-neutral approaches are fine ways to support students who face hardships.

The Trump administration has already been tough on diversity programs at colleges and universities. Harvard University, the oldest and wealthiest university in the United States, has been a special focus. The administration has frozen some of Harvard's federal funding, launched investigations into the school, and threatened to take away its tax-exempt status. Rights advocates warn that these actions put free speech, due process, and academic freedom at risk across the country.