Harvard University says there’s “no legal basis” to rescind its tax-exempt status, as President Trump pushes for the IRS to strip the Cambridge campus of its status after the university rejected a list of demands.
While Trump freezes billions in Harvard grants and threatens its tax-exempt status, the Ivy League school is calling the potential move “unlawful” and warning about the implications of “such an unprecedented action.”
“There is no legal basis to rescind Harvard’s tax-exempt status,” a Harvard spokesperson said in a statement.
“The government has long exempted universities from taxes in order to support their educational mission,” the university spokesperson said. “The tax exemption means that more of every dollar can go toward scholarships for students, lifesaving and life-enhancing medical research, and technological advancements that drive economic growth.”
Harvard provided more than $749 million in financial aid in fiscal year 2024. Meanwhile, the university’s annual operating expenses that year came out to $6.4 billion, and its endowment was $53.2 billion.
Nearly one-third of funding that supports research at Harvard ($489 million in fiscal year 2023) comes directly from the university — with another $1 billion in sponsored research funding from federal, foundation and industry sponsors.
“Such an unprecedented action (stripping its tax-exempt status) would endanger our ability to carry out our educational mission,” the Harvard spokesperson said.
“It would result in diminished financial aid for students, abandonment of critical medical research programs, and lost opportunities for innovation,” the spokesperson added. “The unlawful use of this instrument more broadly would have grave consequences for the future of higher education in America.”
Harvard on Monday rejected a list of demands from the Trump administration related to activism on campus, DEI programs, antisemitism, admissions policies, and more. Later that day, the feds froze more than $2 billion in grants and contracts to the university.
In addition to the tax-exempt status threat, the Department of Homeland Security has ordered Harvard to turn over “detailed records” of its foreign student visa holders’ “illegal and violent activities” by April 30.
International students make up 27% of the campus.
“Harvard bending the knee to antisemitism — driven by its spineless leadership — fuels a cesspool of extremist riots and threatens our national security,” DHS Secretary Kristi Noem said in a statement. “With anti-American, pro-Hamas ideology poisoning its campus and classrooms, Harvard’s position as a top institution of higher learning is a distant memory. America demands more from universities entrusted with taxpayer dollars.”
DHS also said it was canceling two Harvard grants that total $2.7 million.
“Harvard is aware of the Department of Homeland Security’s letter regarding grant cancellations and scrutiny of foreign student visas, which—like the Administration’s announcement of the freeze of $2.2 billion in grants and $60 million in contracts, and reports of the revocation of Harvard’s 501(c)(3) tax-exempt status—follows on the heels of our statement that Harvard will not surrender its independence or relinquish its constitutional rights,” the university spokesperson said. “We continue to stand by that statement. We will continue to comply with the law and expect the Administration to do the same.
“Harvard values the rule of law and expects all members of our community to comply with University policies and applicable legal standards,” the spokesperson added. “If federal action is taken against a member of our community, we expect it will be based on clear evidence, follow established legal procedures, and respect the constitutional rights afforded to all individuals.”
For the Trump administration, Harvard presents the first major hurdle in its attempt to force change at universities that Republicans say have become hotbeds of liberalism and antisemitism.
Trump’s campaign started at Columbia University, which initially agreed to several demands from the Trump administration but took a more emboldened tone after Harvard’s defiance. Columbia’s acting president, Claire Shipman, said in a campus message Monday that some of the demands “are not subject to negotiation” and that she read of Harvard’s rejection with “great interest.”
Trump has targeted schools accused of tolerating antisemitism amid a wave of pro-Palestinian protests on U.S. campuses. Some of the government’s demands touch directly on that activism, calling on Harvard to impose tougher discipline on protesters and to screen international students for those who are “hostile to the American values.”
Herald wire services were used in this report.