Trump targets tax-exempt schools favoring minorities

The Trump administration proposed a rule on Thursday to strip tax-exempt status from private schools that give preferential treatment to minority students.

The move targets long-standing policies at some elite private schools that historically favored racial minorities in admissions or financial aid. These schools, often with deep ties to civil rights-era initiatives, have used such practices to promote diversity, but critics argue they violate anti-discrimination principles. The proposed regulation would enforce a consistent standard: any school engaging in race-based preferences would lose federal tax benefits.

The Treasury Department and IRS said the rule would ensure "institutions that continue to use discriminatory practices will no longer receive the benefits of federal tax-exempt status." The change follows years of conservative legal challenges to race-conscious policies, including the Supreme Court's 2023 ruling that struck down affirmative action in college admissions. Supporters of the rule argue it aligns tax policy with constitutional principles, while opponents warn it could dismantle diversity efforts in education.

The proposal now enters a public comment period before finalization. If enacted, it could force schools to abandon race-based preferences or risk losing tax-exempt status, which often amounts to millions in savings. The rule’s impact would extend beyond admissions, potentially affecting scholarships and other programs designed to support minority students.