HR-1128 — Endowment Accountability Act

YourVoice.Now Summary

Corporate Benefits

Private colleges with big endowments would pay 10% on investment income instead of 1.4% — and more schools would owe it.

Corporate Benefits

Wealthy private colleges' tax break — 1.4% rate rises to 10%

Private colleges with large endowments now pay 1.4 percent on what their investments earn. The bill would set that rate at 10 percent for tax years starting after it becomes law.

Colleges exempt from endowment tax — asset cutoff drops to $200,000

The tax only applies to private colleges holding at least $500,000 in endowment assets for each student. Lowering that cutoff to $200,000 would bring many more schools under the tax.

More about this bill

Some private colleges pay a federal tax on money their endowments earn. An endowment is a school's large savings fund. The rate is 1.4 percent now. This bill would raise it to 10 percent. The tax would also cover more schools. Today it hits only private colleges with at least $500,000 in endowment assets per student. That cutoff would fall to $200,000 per student. The new rules would start with tax years beginning after the bill becomes law. Students and parents would not pay this tax themselves. The schools would.

Congressional Summary

Endowment Accountability Act This bill increases the excise tax on the net investment income of certain private university and college endowments. The bill also expands the number of endowments subject to the excise tax by lowering the endowment asset amount per-student threshold. Under current law, certain private universities and colleges with 500 or more tuition-paying students (of which more than 50% are located in the United States) and endowments that are at least $500,000 per student (per-student threshold) pay an excise tax in the amount of 1.4% on the net investment income from such endowments. The bill increases the amount of the excise tax to 10% of the net investment income from such university and college endowments and lowers the per-student threshold to $200,000.

Legislative Subjects

Higher educationEndowmentsExcise taxUniversitiesTaxation

Details

Congress: 119th
Chamber
Status: in committee
Action
Action Date: 2025-02-07
Date Added: 2026-03-31
Source: Congress.gov →

Record 5dcf5b50-4799-4c5d-94e8-1f852ded1d65 · JSON

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