Federal Tax-Exempt Status Resources

*ADVIS is sharing these resources to help member schools remain informed about this developing regulatory matter. These materials are provided for informational purposes and should not be considered legal advice. Schools should consult qualified legal counsel when evaluating their policies, programs, and potential response.

NAIS FAQs on Proposed Federal Tax-Exemption Regulations

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Legal and Regulatory Background

Primary government sources

• • Proposed Regulations: Racial Nondiscrimination in Private Schools—REG-119986-25
    The complete proposed rule published in the Federal Register.

  • Treasury and IRS Announcement of the Proposed Regulations
    A plain-language overview of the administration’s rationale, the institutions and programs covered, and the anticipated effective date.

  • Federal Rulemaking Portal
    Search for REG-119986-25 to locate the public docket, review submitted comments, or find instructions for submitting comments. The expected comment deadline is November 3, 2026.

Independent legal analyses

• • Foley Hoag: What Private Schools Need to Know
    This is probably the most useful single resource for school leaders. It explains the rule’s application to K–12 schools, scholarships, financial aid, athletics, affinity programs, donor-restricted gifts, and other school-supported programs.

  • Nixon Peabody: IRS Proposal Addresses Racial Nondiscrimination by Tax-Exempt Private Schools
    A concise six-page analysis written specifically with independent schools and private higher education institutions in mind.

Sector and news perspectives

• • Independent Sector Statement on the Proposed Regulations
    Provides the broader nonprofit-sector perspective and raises concerns about organizational mission, association, and the “fundamental public policy” doctrine.

  • Associated Press: Overview of the Proposed Rule and Its Potential Impact
    A readable news summary that provides context for trustees, employees, and community members who may not want to begin with the 28-page proposed regulation.

Background legal authorities

• • IRS Revenue Procedure 75-50
    The longstanding IRS guidance governing racial nondiscrimination policies, publicity, certification, and recordkeeping by tax-exempt private schools. The proposal would revise portions of this guidance.

  • IRS Revenue Procedure 2019-22
    The 2019 modification allowing schools to use their websites to satisfy certain public-notice requirements.

  • Bob Jones University v. United States
    The 1983 Supreme Court decision establishing the “fundamental public policy” foundation relied upon by Treasury and the IRS.

  • Students for Fair Admissions v. Harvard
    The 2023 Supreme Court decision cited by Treasury and the IRS as part of the legal basis for the proposal.